US home sales higher for second month in row

WASHINGTON: US existing home sales rose 2.4 percent in May, marking the first back-to-back monthly increase since 2005, an industry group said on Tuesday in a sign the troubled sector was steadying.

The National Association of Realtors attributed the increase to "favorable affordability conditions and a first-time buyer tax credit" offered by the US government.

"Historically low mortgage interest rates clearly drew buyers into the market, and housing remains very affordable even with a recent uptick in rates," said Lawrence Yun, the group's chief economist.

"First-time buyers also are being drawn off the sidelines by the 8,000-dollar tax credit, which is helping to absorb inventory. However, the increase in sales is less than expected because poor appraisals are stalling transactions."

The group also reported a decline in the glut of unsold homes.

The NAR said total housing inventory at the end of May fell 3.5 percent to 3.80 million homes available for sale, which represents a 9.6-month supply at the current sales pace, down from a 10.1-month supply in April.