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US home sales surge to 5 12 year high in May
(MENAFN- Arab News) WASHINGTON: US home resales surged to a 5-1/2-year high in May as first-time buyers stepped into the market the latest indication that housing and overall economic activity were gathering steam in the second quarter.
The National Association of Realtors said on Monday existing home sales increased 5.1 percent to an annual rate of 5.35 million units the highest level since November 2009.
That left sales this year on track for their strongest performance since 2007.
"It suggests that the US housing market recovery is back on track after the missteps earlier this year. We expect this upbeat tone in the housing recovery to continue as the favorable domestic fundamentals begin to reassert themselves" said Millan Mulraine deputy chief economist at TD Securities in New York.
Last month's increase unwound April's surprise drop in purchases which economists had dismissed as a blip given that forward-looking indicators on home sales including mortgage applications had been fairly strong during that period.
The Realtors group revised April's sales pace up to 5.09 million units from the previously reported 5.04 million units. Economists polled by Reuters had forecast home resales rising to a 5.26 million-unit pace last month.
First-time buyers accounted for 32 percent of transactions the largest share since September 2012. Still the share remains well below the 40 percent to 45 percent that economists and realtors say is required for a robust housing market.
May's sturdy home sales report added to last week's data on building permits in portraying an upbeat picture of the housing market. It joined strong retail sales consumer sentiment and employment data reports in suggesting a building up of momentum in the economy after output contracted at the start of the year.
The strengthening economic outlook keeps the Federal Reserve on course to raise interest rates later this year.
US stocks extended gains on the housing data. Market sentiment was also buoyed by hopes of a deal to avert a debt default by Greece. The housing index was up 0.76 percent.
The National Association of Realtors said on Monday existing home sales increased 5.1 percent to an annual rate of 5.35 million units the highest level since November 2009.
That left sales this year on track for their strongest performance since 2007.
"It suggests that the US housing market recovery is back on track after the missteps earlier this year. We expect this upbeat tone in the housing recovery to continue as the favorable domestic fundamentals begin to reassert themselves" said Millan Mulraine deputy chief economist at TD Securities in New York.
Last month's increase unwound April's surprise drop in purchases which economists had dismissed as a blip given that forward-looking indicators on home sales including mortgage applications had been fairly strong during that period.
The Realtors group revised April's sales pace up to 5.09 million units from the previously reported 5.04 million units. Economists polled by Reuters had forecast home resales rising to a 5.26 million-unit pace last month.
First-time buyers accounted for 32 percent of transactions the largest share since September 2012. Still the share remains well below the 40 percent to 45 percent that economists and realtors say is required for a robust housing market.
May's sturdy home sales report added to last week's data on building permits in portraying an upbeat picture of the housing market. It joined strong retail sales consumer sentiment and employment data reports in suggesting a building up of momentum in the economy after output contracted at the start of the year.
The strengthening economic outlook keeps the Federal Reserve on course to raise interest rates later this year.
US stocks extended gains on the housing data. Market sentiment was also buoyed by hopes of a deal to avert a debt default by Greece. The housing index was up 0.76 percent.
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