NAR Hoping Increase in 'Pending' Index a Positive Sign

The National Association of Realtors' 'Pending Home Sales Index' rose in March for the second consecutive month, and the trade group is hoping that this could be a sign that home sales are finally catching fire. However, housing analyst Jack McCabe cautioned this morning that "one month does not make a trend." Moreover, in recent interviews with National Mortgage News, two large lenders - Bank of America and Chase - said that refinancings were accounting for a huge percentage of their originations - and not purchase loans. Still, NAR's index increased to a reading of 84.6 in March, compared to 82 and 80.4 in February and January, respectively. In December the ratio was 87.1. NAR economist Lawrence Yun said it could take "a few months for the market to gain momentum," adding that the second monthly increase "could be the leading edge of first-time buyers responding to" favorable affordability conditions and a national first-time buyer tax credit of $8,000. (In California the tax credit is $10,000.)