Oddly, the AP doesn’t get around to using its favorite adverb for economic reporting, even though in this case the news certainly came “unexpectedly.” Thomson Reuters analysts had finally predicted a downturn in housing resales after getting surprised for months over bad news. This time, though, the news was unexpectedly good:
The number of buyers who agreed to purchase previously occupied homes rose sharply in February, far exceeding expectations, in a sign that the housing market may be coming back from the winter doldrums.
The National Association of Realtors said Monday its seasonally adjusted index of sales agreements rose 8.2 percent from January to a February reading of 97.6. January’s reading was revised slightly downward to 90.2. …
Economists surveyed by Thomson Reuters had expected the index would fall slightly to 90.3.
This time, the news was more widespread as well. The Midwest did best, with a 22% increase in February, while the South and East each gained 9%. The West, however, continues to slide, falling 5% in the region where foreclosures have been more common.
Does this represent a return of confidence in the market, or perhaps just a case of reaching bottom on housing values? Foreclosures are still expected to resurge this year, which will keep housing values depressed. Unemployment has not improved, which most analysts believe is necessary for the housing markets to regain their footing. But this improvement, expected or not, could signal that the bottom has been reached in most areas of the country and that consumer confidence has begun to return.
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