Did Congressional wrangling over tax credit cause plunge in home resales?

The National Association of Realtors (NAR) released their index of pending homes sales today, which shows a 7.7 percent slump -- almost double what economists expected. However, the news may appear worse than it actually is. During January and most of February, people held back from home purchase decisions waiting for Congress to make up its mind on a tax credit.

At one point on the Senate side, the proposed tax credit for home purchases was as high as $15,000 for anyone. Ultimately, the negotiated settlement was for an $8,000 tax credit for first-time buyers. But those shenanigans likely kept people on the sidelines waiting for the dust to settle.