WASHINGTON — Pending home sales rose in May for the fourth straight month, spurred by low prices and a first-time-homebuyers tax credit, fresh evidence that the housing sector may be recovering.
The National Association of Realtors said Wednesday that its seasonally adjusted index of pending sales increased by 0.1 percent in May to 90.7. Analysts expected no change, according to Thomson Reuters.
While the increase was small, it followed a 7.1 percent jump in the index in April.
“The pronounced increase in April and the fact that May sustained this rise does indicate that actual existing-home sales are poised to rise in the coming month or two,” said Joshua Shapiro, chief U.S. economist for economic-forecasting firm MFR Inc., in a note to clients.
The index, which tracks signed contracts to purchase previously occupied homes, is considered a barometer for future home sales.
Typically, there is a one- to two-month lag between a sales contract and a completed deal.
The index is now 6.7 percent higher than in May 2008, when it was at 85. The last time it increased for four straight months was in October 2004, the NAR said.
Other housing indicators have been mixed. The Realtors said last week that completed home sales rose 2.4 percent from April to May, the third month-to-month increase this year.
But new-home sales dipped 0.6 percent in May.
