House Market in US
Thursday, May 28, 2009
Sales of previously owned U.S. homes rose in April, a report showed on Wednesday, providing new evidence the housing market is stabilizing and backing views that the recession is nearing an end.
The National Association of Realtors said sales climbed 2.9 percent to an annual rate of 4.68 million as the traditional spring home-buying season swung into gear. The positive picture, however, was dimmed by a separate report showing applications for home loans fell to their lowest level since early March last week as mortgage costs rose.
Worries about the government's ability to fund costly measures to rescue the economy drove longer-dated government bond yields higher on Wednesday, with the spread between the 2-year and 10-year Treasury notes widening to a record 2.75 percentage points. The rise in bond yields threatens to push up borrowing costs for consumers and businesses, and U.S. stocks sold off on concerns the economy could suffer. Major indexes ended more than 1 percent lower. Economists, however, were heartened by the home sales data and said borrowing costs had not moved up enough to imperil the housing market's chances of recovery.
"I don't think it's a threat as long as mortgage rates stay low and so far they have," said Patrick Newport, an economist at IHS Global Insight in Lexington, Massachusetts.
In general, the data was seen as a fresh hint that the steep 17-month U.S. economic downturn, triggered by the collapse of the housing market, was easing and could well end by the third quarter, as a survey published by the National Association of Business Economists predicted. The pace of job losses slowed last month, claims for unemployment aid have come off their peaks, and consumer confidence has risen from recent rock-bottom levels.
"The national economy is showing some initial signs of stability," U.S. Treasury Secretary Timothy Geithner said in Boston as he announced $1.5 billion in federal tax credits for community development projects. "This is just the beginning, however. We have a long way to go."
Labels: Economy
posted @ 11:39 AM,
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