Pending home sales had risen nine straight months, dating back to last February, but could not continue the streak to ten months. On Tuesday January 5, 2010 month over month pending home sale came in at -16% verses the consensus of -2%.
The decline is due to the expiration of the first time homebuyer tax credit which was originally due to expire November 30th. The tax credit has now been extended to April 30th so November’s numbers could be a one month slowdown in the home sales turnaround.
An increase next month in pending home sales would be interpreted as an encouraging sign of pent-up housing demand that is being driven more by low prices and low mortgage rates than it is by the prospect of a tax credit.
Gregory Menges is a founder of Boston Independent Advisors. Greg is a seasoned financial advisor with more than 15 years experience serving individuals, families, business owners, and company sponsored retirement plans. All securities offered through Investors Capital Corp., Member FINRA/SIPC -- Advisory Services offered through Investors Capital Advisory.
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