Rise in signed contracts gives housing market liftI've tried to copy/paste both sides of the discussion and highlighted the 'West' data because of its proximity to IFP.A operations. The complete article which came out today is available on Yahoo Finance USA.
NEW YORK (AP) -- People are starting to buy homes again, lifting a battered industry that is bracing for its worst sales year in more than a decade.
Signed contracts to purchase homes rose in November, the fourth increase in five months. That should give the housing market a boost in the first few months of the new year because there's usually a one- to two-month lag between a sales contract and a completed deal.
Economists cautioned that a major reason for the jump is that people are buying foreclosed homes, which sell at steep discounts and weigh on the broader market. Another obstacle is the sudden spike in the 30-year fixed mortgage rate, which only weeks ago had fallen a 40-year low.
Still many economists expect sales to gradually rise next year as the economy adds more jobs and home prices stabilize.
"Sales appear to be picking up and we expect better sales in the next several months," said Patrick Newport, a housing economist at IHS Global Insight. "A lot of that is because the job market is improving."
There are several challenges facing the housing market aside from foreclosures. Potential buyers are worried about their jobs or are unable to qualify for a mortgage because lenders have tightened standards. And now mortgage rates are on the rise, gaining about two-thirds of a percentage point in the last month.
The report on contract signings from the Realtors showed that signings jumped 18.2 percent in the West and edged up 1.8 percent in the Northeast. The Midwest region saw a 4.2 percent drop in signings in October and the South posted a 1.8-percent dip.