March 23, 2006 – Sales of existing homes rebounded during February, in a surprise to economists after months of soft data had suggested that the housing sector was beginning to cool. The National Association of Realtors said Thursday that sales of existing single-family homes and condominiums increased 5.2% to a seasonally adjusted annual rate of 6.91 million units from January’s revised 6.57 million annual pace, halting a five-month string of declines in home resales. January resales were originally reported at 6.56 million. Single-family home sales rose 4.7%, while sales of condominiums and co-ops jumped 8.8%. Stephen Stanley, chief economist at RBS Greenwich Capital, called the data “a very surprising result” in light of previous declines and a growing consensus that “the housing sector is softening rapidly.” David Lereah, chief economist for the Realtors, said that “higher interest rates had been tapping the breaks, notably in higher-cost housing markets, but we’re seeing signs of stabilization in the market now with the sales rebound.” The Realtors have been forecasting home resales would fall by about 5% this year compared with last year’s record pace, but Mr. Lereah said he may have to revise that forecast given the unexpected strength in February.
Existing Home Sales Rise [Wall Street Journal]