Could it be a sign of recovery? After the Fed has worked to push mortgage rates lower and lower, there was good news for the housing market yesterday: existing home sales rose 5.1% in the month of February to a seasonally adjusted annual rate of 4.72 million units, according to the National Association of Realtors (NAR). Reasons could be 30-year mortgage rates around 5%, which the Fed has pushed lower by intervening in the mortgage market; the stimulus package's $8,000 tax credit for home buyers; low prices on foreclosed properties; or all three. A warning against premature celebration: sales are still 4.6% lower than they were a year ago, NAR points out.
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