Today’s data from the National Association of Realtors sure makes it seem like housing has hit the much-awaited bottom: Pending-home sales showed a surprising gain of 8.2% in February, as buyers responded to improved weather and the federal home-buyer tax credit.
Sales of homes entered into contract jumped by the largest margin in more than eight years, Weiss Research notes, with broad-based regional strength.
The excitement is understandable. Housing has been so bad for so long that it’s easy to get giddy over a great statistic. But, while this is good news, proceed with caution.
Much of the bump comes from the federal tax credit, which expires at the end of the month. “Cheap homes and cheap financing are gradually bringing out buyers,†Mike Larson, real estate and interest rate analyst at Weiss Research, wrote in a client note.+
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