|Published:||Apr 22, 2010 10:24 AM EDT|
|Updated:||Apr 22, 2010 10:24 AM EDT|
WASHINGTON (AP) - Home sales rose more than expected in March,
reversing three months of declines, as government incentives drew
in buyers and kicked off what's expected to be a strong spring
Sales of previously occupied homes rose 6.8 percent to a
seasonally adjusted annual rate of 5.35 million last month, the
highest level since December, the National Association of Realtors
said Thursday. February's sales figures were revised downward
slightly to 5.01 million.
"The spring selling season will be a success and probably the
most active we're seen in years," said Stuart Hoffman, chief
economist at PNC Financial Services Group.
Sales had been expected to rise 5.2 percent to 5.28 million,
according to economists surveyed by Thomson Reuters.
The results show the housing market is stabilizing after a
devastating bust. But the true test will be whether the market can
stand on its own after federal tax credits expire at the end of
Sales rose in every region, surging more than 7 percent in the
Midwest and South, 6.6 percent in the West and 6 percent in the
"It's a very broad-based recovery," said Lawrence Yun, the
Realtors' chief economist.
The median sales price was $170,700, up almost 4 percent from
$164,600 a month earlier and nearly unchanged from $170,000 in
The inventory of unsold homes on the market was up 1.5 percent
at 3.6 million. That's an eight month supply at the current sales
Sales nationally had declined over the winter, eroding gains
made last fall and summer. The downward direction troubled
economists because the government has taken unprecedented steps to
support the housing sector.
For several months, home shoppers didn't feel rushed after
lawmakers extended the deadline to qualify for tax incentives. The
government is offering a $8,000 credit for first-time buyers and
$6,500 for current homeowners willing to buy and move into another
But now time is running out. Buyers must sign contract offers by
April 30 to qualify, and real estate agents say that's spurring
"Many people who otherwise wouldn't be on the market for a home
want to take advantage of these tax credits," said Kathi McLeod,
sales manager for Windermere Real Estate in Boise, Idaho. "You
have buyers who have been looking and looking at properties and
realizing that it's almost too late, so they're really scrambling
and jumping into deals."
The Realtors group is not pushing for an another extension of
the tax credit. Yun said he believes there will be enough demand in
the second half of the year without a government subsidy.
Still, some housing market experts predict the market will take
a dramatic "double-dip" once the government's supports are gone.
But others argue that there is enough pent-up demand to keep the
market chugging. And prices have fallen dramatically since the boom
years - as much as 50 percent in some places. So buyers can pick up