US: Bracing for a strong rebound in existing home sales – BMO CM

Michael Gregory, Deputy Chief Economist at BMO Capital Markets, suggests that the US existing homes sales are a measure of closings and will be influenced by contracts signed in March and February.

Key Quotes

“Unfortunately, there was an unhelpful ebbing backlog here (pending home sales dipped 0.8% in March). However, suggesting that April was not a complete washout for newly-contracted home sales, mortgage applications for purchases averaged their highest level since the spring of 2010 (if not for this we would have marked down our estimates even more). Importantly, we are bracing for a strong rebound in May.”