That's the right direction.

Photographer: David Paul Morris/Bloomberg

A Housing Recovery Built to Last?

Jonathan Miller writes about the housing economy and other aspects of real estate. He began a real estate blog, the Matrix, in 2005, and has written a column for He is co-founder of Miller Samuel, a residential real estate appraisal company, and the commercial valuation firm Miller Cicero.
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The housing market has recovered in fits and starts since the financial crisis, so it's worth noting when one important indicator looks really strong. This is the case with the pending home sales index, which reflects contracts signed for purchases of single-family homes, co-ops and condos, published by the National Association of Realtors. 

As of March, the index (using the nonseasonally adjusted results) registered a reading of 132.2, up 13.4 percent from a year earlier. That was the second highest level since the financial crisis began. The highest point in the post-crisis period was in April 2010, the last month of a program that gave buyers tax credits as part of the federal stimulus effort to jump-start the economy.  In May, the month after the program expired, pending sales plummeted 33.3 percent, showing that the stimulus didn't give housing a lasting boost. 

But housing does seem to be making a more sustainable comeback. Here's another way to look at the index. 

From December, almost always the annual low point for sales, to March, the beginning of the spring selling season, the index jumped 96 percent. That's the biggest increase for this period on record.

What does this tell us?

The highest four-month reading for the index was from March to June 2005. That was at least a full year before housing prices peaked in the summer of 2006. Because the index is a leading indicator of the housing market, this suggests we might see bigger price gains ahead for 2016.

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Jonathan J Miller at

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