Overall home sale data for February is still a few days away, but economists surveyed by Bloomberg are already anticipating a decent uptick in sales for the month.
According to the economists, sales – bolstered by gains in jobs and income, home affordability and record low mortgage rates – are projected to increase from a 4.89 million annual rate in January to a 4.93 million rate in February, which would represent the strongest sales data since May 2010.
Russell Price, a senior economist at Ameriprise Financial, said in the Bloomberg piece that though housing in 2012 may only show modest gains, its improvement from years past represents a bold turn of events.
“The evidence is very clear that housing is beginning to improve,” Price said. “I do not expect housing to be a drag on GDP this year. It started to be a modest positive contributor last year. Now that it’s actually contributing again, that’s a significant turn of events.”
Martin Connor, chief financial officer at Toll Brothers, said a number of economic factors are contributing to the positive thoughts on housing in recent weeks.
“All the economic signs seem to be positive in terms of consumer confidence, interest rates, unemployment levels,” , Connor said at a March 5 investors’ conference in Orlando, according to Bloomberg.
And in addition to the aforementioned home sales data, this week will bring other home stats with expected returns. Existing-home sales, which are due out from the National Association of Realtors on Wednesday, are anticipated to increase by 0.7 percent from January to February, a 4.6 million annual rate that would be the highest in 21 months. New home sales, due from the Commerce Department on March 23, are expected to increase from 321,000 to 325,000, the highest annual rate since December 2010.
Economists are also prepping for positive results for February housing starts, which will be released by the Commerce Department on March 20. According to the projections, builders will have started 700,000 homes on an annual pace, the most in three months, and building permits should also show the best results since March 2010. The National Association of Home Builders/Wells Fargo index of builder confidence, which will come out later today, should climb to its highest level since May 2007, and such results will only confirm good news for home starts.
Bloomberg made mention of two important contributors to housing’s recent progressions – the labor market and the unseasonably warm weather. Payrolls just completed their strongest six-month increase in more than five years, the jobless rate is at its lowest level in three years, and the average temperature in February, 38.2 degrees Fahrenheit, is the 17th warmest in 118 years.