The existing housing sales data was released by the NAR today [pdf] and the news was better than expected. In general economists projected a decline in existing home sale volume. What they got instead was a 5.2% increase over January and a 0.3% decline over February 2005. This marks the first month over month increase after 5 months of declines.
Why the surprise? Apparently Mother Nature got her broker’s license in February because the weather co-operated and we had an unseasonably warm period, which favors the real estate market as people become anxious to end the winter blues and it is easier to view properties.
The irony here is that the only region to see a decline in activity was in the south, arguably the warmest.
Existing-home sales rose 19.2% in the Northeast and 11.1% in the Midwest — areas where weather was unseasonably warm. Sales were up 5.1% in the West and declined 2.5% in the South [WSJ].
However, in the true spirit of a zero-sum game there are concerns that this will take away sales over the coming month, much like the extensive summer auto rebates did to the fall sales levels.
“Spring selling season started a little earlier because of the warm weather,” Mr. Lereah said, “but I expect the numbers to come down a bit in the next few months.” [NYT]
Most other publications bought into Lereah’s reasoning which was:
Warm weather in January prompting sales: these sales closed in February.