Pending home sales pop

Pending home sales figures from the National Association of Realtors were just released. Sales popped 4.3% in August after gaining 4.5% a month earlier. That was better than the 2.5% increase economists were looking for, though sales are still down more than 18% from a year earlier. Regionally speaking, sales rose 2.1% in the Midwest, 6.4% in the West, and 6.7% in the South. They fell 2.9% in the Northeast.

Pending sales have clearly stabilized in the wake of this summer's tax credit-driven plunge. Indeed, we saw August gains in three out of four regions, led by the South. But when you step back and look at the big picture, you realize that watching the housing market these days is a bit like watching a pet rock. You keep hoping for it to sit up, roll over, or do something. But it doesn't. It just sits there marking time.

Frankly, that's what I expect to see for the foreseeable future. We have cheap mortgages and cheap homes. Yet the conditions for a substantial improvement aren't in place, with the economy weak and consumer confidence lacking. That means pricing and sales will likely remain stuck in the mud.