US housing market creaks to life
By Veronica Smith, AFP
May 25, 2012, 11:38 am TWN
WASHINGTON -- The huge, depressed U.S. housing market is showing signs of a turnaround, raising hopes that one of the biggest barriers to the economy's recovery may be finally swept away.
April put enough spring in the real-estate sector that some analysts say that the low point has been reached six years after a price bubble collapsed.
“You have to hit bottom before you can start rising and that has happened in the housing market,” said Joel Naroff of Naroff Economic Advisors.
This week has seen a string of good news on the home front. Sales and prices rose for both existing and new homes in April.
Previous months' data were revised higher, confirming a slight upward trend as the U.S. economy slowly heals from the Great Recession and unemployment drifts lower.
“The demand drivers for housing are improving. Job growth is running at a consistent pace and confidence is firming. Constraints on demand due to tight mortgage credit will at least not worsen, and housing affordability is high,” said Celia Chen at Moody's Analytics.
Although mortgage rates have been lingering around all-time lows — the 30-year rate hit a new record last week at 3.79 percent — would-be homebuyers have struggled to meet credit conditions in the wake of the subprime crisis.
But the uptick in home prices appears to be overcoming consumers' fears of buying into a falling market.
Sales of existing homes rose 3.4 percent in April and were 10-percent higher than in April 2011, the National Association of Realtors (NAR) said Tuesday.