Lereah on February Pending Sales

Pending sales of U.S. homes edged lower in February, but a big upward revision to the previous month's data may suggest the housing market's cool-off period is nearly over, a trade group said on Monday.

The Pending Home Sales Index, based on contracts signed in February, stood at 117.7, down 0.8 percent from January and 5.2 percent from a year ago, the National Association of Realtors reported.

January's index was revised up to 118.6 from an originally reported 116.3. That revision made January the first month the index has moved higher since rising interest rates started to take the wind out of the U.S. housing market last year.

Economists had forecast the index would be at 116.7 for February.

The Realtors' chief economist, David Lereah, said most of the cooling in the housing market has already happened.

"We can expect a historically strong housing market moving forward, earmarked by generally balanced conditions across the country and fairly stable levels of home sales with some month-to-month fluctuations," Lereah said.

"This normalization is healthy because it is taking a lot of the pressure off of the decision process for both home buyers and sellers -- pressure that was driving abnormal rates of price growth across much of the country over the last few years." Reuters 4/3/06