Home Sales Rise, but Hurdles Persist

Home sales rebounded in OctoberThe housing market is making strides in the right direction, but the summit is still a ways to go. Pending home sales bounced back with double-digit growth in October, a vast improvement since bottoming out in June.

Pending home sales rose 10.4 percent to 89.3 based on contracts signed in October, up from 80.9 in September. Yet even with the positive growth, the latest figures trail October 2009 numbers by 20.5 percent, when the housing market was buoyed by the homebuyer tax credit.
Lawrence Yun, chief economist for the National Association of Realtors, believes the growth in sales is due in part to the availability of affordable homes, but more significantly, a return to normal lending practices and less fees for low-risk borrowers.

Still lurking in the background, however, is the ongoing controversy surrounding plans to limit the size of the mortgage interest deduction for homebuyers. How legislators ultimately deal with this possible deficit-cutting option could have a major impact on the housing market and homebuyer confidence.

For more on home sales, home prices and related topics see these AOL Real Estateguides:

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