Despite a slow third quarter start the economic recovery my have just received a big help from of all places the housing market. November's homes sales last month surged and in turn may have helped end the year on a very positive note.
It's been reported by the National Association of Realtors that November home sales rose 7.4 percent to a seasonally adjusted annual rate of 6.54 million up from Octobers downturned number of 6.09 million.
November home sales of existing homes rose to their highest level in almost three years and economists had expected a rise to only 6.25 million.
As the economy stabilizes there should be a greater amount of buyer interest and a rebound in housing market could help give the economic recovery a boost in the fourth quarter. It should be noted that many analysts believe the economy is on track for a better result in 2009's final quarter.
The average growing rate for the economy right now is nearly 4 percent in the current quarter and if it remains strong until the New Year then it would mark the strongest showing since the 5.4 percent growth shown in the first quarter of 2006 which was even before the recession began.
Also, final quarter growth is expected to come from companies restocking their depleted inventories from the holiday season. Stronger exports, combined with spending by U.S. consumers and businesses, also will help fourth-quarter growth.
The economy has been on a wild ride this year because just in the first three months of 2009 the economy shrank at a pace of 6.4 percent which is the worst downhill slide in the economy in 27 years. However, the economy returned to positive territory in the third quarter.
The third quarter's overall growth was aided by government stimulus plans like the "Cash for Clunkers" rebates as well as the $8,000 tax credit for first-time home buyers.
November's home sales were boosted by buyers who were racing against the clock to complete their sales before the original expiration date of the $8,000 tax credit for first-time home buyers which was on November 30th. Congress voted and passed last month to extend and expand the credit to make sure the housing market could maintain its recovery.
Further good news for the housing market was the announcement last week from the Federal Reserve where they pledged to keep interest rates at a record low to ensure the recovery gains traction.