The Northeast region led the nation in home sales improvements in July, but economists are cautious about what the figures might mean.
Around the nation, according to the National Association of Realtors, home sales jumped more than 7% in July over June’s numbers – that’s the fourth consecutive month of modest growth. In the Northeast, the picture was even more encouraging – existing home sales rose 13.4% in July – and that was a more than 3% improvement over the same month last year. Many analysts believe the market is seeing the effects of stimulus cash – first time homebuyers can currently claim an $8,000 tax credit.
But economist Don Klepper Smith of DataCore Partners in New Haven says it remain to be seen if the upward trend can be sustained.
"The good news here is when you look at the components of real GDP, they’re apt to turn positive over the short term. The question though becomes one of is this growth going to be sustainable over time, or are we simply borrowing some growth from future quarters, shifting that into the current time frame. So I think that’s our key right now, and let’s hope that we can build on the confidence levels that we’re now working with."
Home prices have yet to see the same kind of recovery – the median price in the Northeast and around the nation is still down 15% from this time last year.