My Real Estate Blog

The economy in late 2010 may have grown at a quicker pace than some analysts previously thought. The Commerce Department reported that gross domestic product (GDP) was up 3.1% in the last quarter of 2010, thanks in part to large rises of corporate profits.

Consumer spending was up as well, this being the eighth straight month of increases. Spending rose 0.7% in February. The department also reported that inflation accelerated at its fastest rate since June 2009. Incomes also rose in February by 0.3%.  

Pending home sales, compiled by a National Association of Realtors' survey, were up by 2.1% in February over the month prior. And while this is 8.2% below figures from February 2010, they are still a promising trend.

Month-to-month movements can be instructive, but in this uneven recovery it's important to look at the longer term performance. Pending home sales have trended up very nicely since bottoming out last June, even with periodic monthly declines. Contract activity is now 20% above the low point immediately following expiration of the home buyer tax credit.

Regionally, the area with the largest increase was the West, up by 7.0%. It is the only region experiencing higher levels of pending sales than a year prior. The Midwest wasn't far behind, with a 4.0% rise for the month.

Existing-home sales are expected to rise 5 to 10% this year with the economic recovery, job creation and excellent affordability conditions providing confidence to buyers who've been on the sidelines.

We here in the Metro DC area continue to be the only Metropolitan area in the country where home prices are on the rise, up 3.2%.