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Home sales rise, but it’s no rebound

High unemployment, strict lending standards, and a record number of foreclosures are still deterring would-be buyers. High unemployment, strict lending standards, and a record number of foreclosures are still deterring would-be buyers. (Paul Sakuma/ Associated Press/ File 2011)
Associated Press / March 29, 2011

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WASHINGTON — More Americans signed contracts to buy homes in February, but sales were uneven and not enough to signal a housing market rebound.

Sales agreements rose 2.1 percent to a reading of 90.8, according to the National Association of Realtors’ pending sales index released.

Signings were 19.6 percent above June’s index reading, the low point since the housing bust. Still, the index is below 100, which is considered a healthy level.

Contract signings are usually a good indicator of where the housing market is heading. There is usually a one- to two-month lag between a sales contract and a completed deal.

But the Realtors group also noted “a measurable level of contract cancellations’’ occurred in February. Many buyers canceled after appraisals showed the properties were valued much lower than their initial bids.

The pace of sales varied from region to region. Signings fell 10.9 percent in the Northeast. They rose 2.7 percent in the South, 4 percent in the Midwest, and 7 percent in the West.

Sales of previously owned homes fell last year to the lowest level in 13 years. The rise in foreclosures has pushed the median price of previously occupied homes to its lowest point in nearly 9 years.

New-home sales have fared even worse.

Americans are on track to buy fewer new homes than in any year since the government began keeping data almost a half-century ago. Sales are now just half the pace of 1963 — even though there are 120 million more people in the United States.