Positive housing market figures give boost to US recovery hopes

 
City A.M. Reporter
AMERICA’S ailing housing market could be on the mend, according to two positive surveys released across the pond yesterday.

US homebuilder sentiment rose for a seventh consecutive month in November and hit its highest level in over six years, according to one widely-regarded survey.

The National Association of Home Builders’ housing market index, conducted with Wells Fargo, rose to a score of 46 – up from 41 the previous month.

The index was at its highest level since May 2006.

And home resales unexpectedly rose in October, a separate survey revealed – a sign that slow improvements in the US labour market are helping the housing sector recovery gain traction.

The National Association of Realtors (NAR) said yesterday that existing home sales climbed 2.1 per cent last month to a seasonally adjusted annual rate of 4.79m units.

NAR economist Lawrence Yun said superstorm Sandy, which slammed into the east coast of the US on 29 October, had only a slight impact on home resales. The only region where the pace of sales slipped was the north east.

But Yun said the storm could temporarily hold back the pace of sales in November and December.

“Our view is that housing is in a recovery phase, but one that will be restrained by the availability of credit, the pace of improvement in labor market conditions, and the overhang from distressed and foreclosed properties,” commented Michael Gapen, an economist at Barclays Research.