The housing sector was totally destroyed after the financial crisis of 2008. The sector couldn’t see strong recovery since then. The increased number of Americans signing contracts to buy previously owned residential properties is showing some positive sign. The number of contract signing has increased more than last four years. The pending home sales index increased to 1.1 percent after a massive growth rate of 3.6 percent in February.
The growth rate was highest since the month of October in 2010. The National Association of Realtors released the data in Washington. It shows that southern and western regions in the country have increased demands. Homeownership is becoming accessible for the wider population as the labor market is improving and borrowing cost are low due to low-interest rates. The further support this growth we will need more credit accessibility along with a sharp increase in a wage growth. The Steady increase in prices would be helpful in order to attract investments in real estate. The property seller will be also encouraged by this.
Chief US economist Joseph LaVorgna from the Deutsche Bank Securities Inc. base in New York said that though the trend is positive, it is very uneven and slow, which increases uncertainties. Things are definitely working out in a positive way but it needs to be sustained. The data by the association reveals that more traditional buyers are replacing investors in this sector by paying in cash. More long-term homeowners are doing transactions in the sector now. Many investors consider pending sales as leading indicator to track new purchases.