NEW YORK (Reuters) - The pace of sales of existing homes in the United States rose 2.9 percent in April, according to an industry survey on Wednesday that supported views the three-year housing recession was near a bottom.
KEY POINTS: * The National Association of Realtors said sales climbed to an annual rate of 4.68 million, from a downwardly revised 4.55 million pace in March, initially reported as 4.57 million. That was slightly higher than market expectations for a 4.66 million-unit pace. * The inventory of existing homes for sale rose 8.8 percent to 3.97 million. The median national home price fell 15.4 percent to $170,200, compared to the same period a year-ago.
THOMAS KUNZ, CHIEF EXECUTIVE OFFICER, CENTURY 21 REAL ESTATE, PARSIPPANY, NEW JERSEY:
“The good news is that as long as transactions are increasing it will burn off some of the inventory.
“I don’t know that I would go all the way to optimistic. But when I see that the transactions are increasing that is important. With historic lows in interest rates and great selections and affordability in pricing, this is the probably the best buyer’s market I’ve seen in over 30 years.
“I’m hoping that more people will take a look at it, and at least understand what their position might be with rates and prices where they are and inventory where it is.”
ZACH PANDL, ECONOMIST, NOMURA GLOBAL ECONOMICS, NEW YORK:
“This existing homes sales report seems to offer another piece of evidence that home sales are stabilizing. But despite the improvement in sales, inventories continue to increase, which is a sign that foreclosure activity might be adding homes to the market faster than sales are removing them. The bottom line is that until this inventory can be removed from the market we expect to see more downward pressure on house prices.”
KEVIN KRUSZENSKI, HEAD OF LISTED TRADING, KEYBANC CAPITAL MARKETS, CLEVELAND:
“We got a pop and then sold right back off. Everybody wants to see the market correct a little bit. There’s a lot of “we’ve come too far too fast.” And we need to digest this big 40 percent move. And I can’t disagree with that. Your upside could be capped a little bit here. We might go into a pretty narrow trading range on the Dow and S&P and digest some of that move. And it could come coincident at a time when activity tends to drop off a little bit in the summer months.
“I don’t think anybody thinks that housing is getting better by any means, a lot of these numbers that are coming out are historic lows.”
STEVEN WIETING, SENIOR ECONOMIST, CITIGROUP, NEW YORK:
“You brew this all together and it looks like, broadly speaking, we have a bit of stability here. (Still,) there’s a great deal of distressed activity holding up these resale measures. A lot of measures are showing conflicting information. The fact that contract signings, or pending home sales, have been stabilizing, is encouraging.”
ROBERT BLAKE, SENIOR CURRENCY STRATEGIST, STATE STREET, BOSTON:
“There’s no question that the extreme collapse in the economy that we saw in the fourth and first quarters is over. But things are still not that great out there, so we are a little skeptical of the ‘green shoots’ optimism on the economic side. We think it’s going to be a long, slow recovery and we will have more bad news to come. Second quarter growth may remain weak. Home sales may have bottomed, but on the construction side, there’s still a huge inventory overhang. There will still be downward pressure on prices for a while, and yesterday’s Case-Shiller data supported that.”
OMER ESINER, SENIOR MARKET ANALYST, TRAVELEX GLOBAL BUSINESS PAYMENTS, WASHINGTON:
“At best, this is a mixed bag of data. More likely the dollar will probably firm on the fact that inventories are rising and prices are falling.”
MARK BONHARD, INVESTMENT ADVISOR, DAWSON WEALTH MANAGEMENT, CLEVELAND, OHIO:
“We are starting to see some signs of recovery both in the housing market and in the economy in general. In housing the volume is there but the prices are still falling and I don’t think we have totally seen bottom.”
SUBODH KUMAR, CHIEF INVESTMENT STRATEGIST, SUBODH KUMAR & ASSOCIATES, TORONTO:
“This is a little bit of good news, since we’ve had some data that still showed some weakening. I think this is more signs of bottoming activity, though it’s too early to say this is part of a trend.
“This won’t have much of an impact on the market today. Investors will be focusing on General Motors and bond deals.”
MARKET REACTION: STOCKS: U.S. stock indexes rose initially, then dipped. BONDS: U.S. Treasury debt prices rose slightly. DOLLAR: U.S. dollar rose against the euro, weakened against the yen.
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