INSTANT VIEW: Biggest gain in pending home sales since 2001

NEW YORK (Reuters) - Pending sales of previously owned U.S. homes in April unexpectedly saw their biggest monthly gain in 7-1/2 years, a report from a trade group on Tuesday showed, buttressing views the U.S. recession was easing.

KEY POINTS:

* The National Association of Realtors said its Pending Home Sales Index, based on contracts signed in April, rose 6.7 percent in April to 90.3 from 84.6 in March.

* It was the biggest monthly increase since October 2001 and it took the index 3.2 percent above its year-ago level in the latest sign the battered U.S. housing sector was stabilizing.

* Economists polled by Reuters ahead of the report were expecting pending home sales to rise 0.5 percent. The downturn in the U.S. housing market touched off a global credit crisis that sent economy's worldwide tumbling into recession. Now, signs are emerging that the global economy is beginning to heal.

* The association's senior economist, Lawrence Yun, credited improved home affordability and a new government program that provides an $8,000 tax credit for first-time homebuyers for the surge in buying activity.

* The NAR said its Housing Affordability Index, which blends factors like home prices and mortgage rates, was "in record territory" with 30-year mortgage rates hovering around 5 percent and an abundance of homes on the market.

COMMENTS:

BERNARD BAUMOHL, CHIEF GLOBAL ECONOMIST, THE ECONOMIC OUTLOOK

GROUP, PRINCETON, NEW JERSEY:

"Based on what we just heard, we are now formally calling for the end of the housing depression and that we increasingly think that the housing market is beginning to turn up."

"We have now seen pending home sales up three months in a row and we have also had the prices of existing home sales also increase three consecutive months. We are seeing for the past year inventories of new and existing homes decline and that includes even the amount of foreclosure in the market. All signs are pointing to a bottoming out now of the housing market."

"The only danger and the only risk there is if we see Treasury yields on 10-year securities begin to move up, and there is a real risk that that could happen."

NIGEL GAULT, CHIEF U.S. ECONOMIST AT GLOBAL INSIGHT IN

LEXINGTON, MASSACHUSETTS:

"I think it seems to be a combination of tax incentives, lower house prices and record low mortgage rates. It is good news to see improvement in the sales because up to now most of the benefit of the low mortgage rates really affected refinancing rather than purchases. This sharp increase is encouraging and we'll have to see what happens over the next two to three months now that mortgage rates are back up somewhat."