WASHINGTON (AP) — For the first time since 2009,previously occupied U.S. homes are selling at
a pace associated with ahealthy market.Sales jumped 6.5 percent in July to a seasonallyadjusted annual
rate of 5.4 million, the National Association ofRealtors said Wednesday. Over the past 12 months, sales
have surged 17.2percent. The trend shows that housing remains a driving force for theeconomy even as
mortgage rates have risen from record lows.Buyershave been purchasing previously occupied homes at an
annual pace above 5million for three straight months. The last time that happened was in2007. Sales are
far above the 3.45 million pace of July 2010, the lowpoint after the housing bubble burst. Analysts
generally think a healthysales pace is roughly between 5 and 5.5 million.Buyers lastmonth weren’t
dissuaded by higher long-term mortgage rates, which havejumped, on average, a full percentage point
since early May. The higherrates might have led some potential buyers to buy in July out of fearthat
rates will rise further.July’s report captures completedsales, which typically reflect mortgage rates
that were locked in amonth or two earlier. A fuller effect of higher mortgage rates might notbe clear
until August home sales are reported next month.Salescould slow later this year, especially if the
Federal Reserve scalesback its bond purchases. The Fed’s bond purchases have kept long-terminterest
rates, including mortgage rates, historically low.For now, the average rate on the 30-year fixed
mortgage remains low by historical standards. It was 4.4 percent last week."Theone-percentage-point
jump in mortgage rates in the past year doesn’tseem to have slowed home sales," said Sal Guatieri,
senior economist atBMO Capital Markets. "The jump in rates might have pulled forward somepurchases,
so a few more months of data are likely needed to wave theall-clear flag."Steady hiring and low
mortgage rates have helpedthe housing market recover over the last year.Banks have also beguneasing
tight credit standards, which have made it hard for many peopleto get mortgages.The number of available
homes is also risingslowly and should support more sales. The supply of unsold homes rose5.6 percent in
July to 2.28 million. That’s still 5 percent below lastyear’s figure. A limited supply has been pushed
up prices nationwide.Therewere other positive signals in Wednesday’s report. The proportion ofdistressed
sales including foreclosures stayed at 15 percent, the lowestsince the Realtors began tracking the
figure in October 2008.Andinvestors made up just 16 percent of purchases, down from a recent peakof 22
percent in February. The smaller proportion of investors suggeststhe market is slowly returning to
normal.One troubling sign:First-time homebuyers aren’t returning to the market. They usually helpdrive
rebounds in home sales. But they made up only 29 percent of salesin July, below the 40 percent level
consistent with a healthy market.Abrighter housing market helps the broader economy. Rising home
salesboosts spending at furniture and home supply stores and lifts realtors’incomes.Higher home values
also make consumers feel wealthier,which lifts their confidence and encourages more spending.
Consumerspending drives roughly 70 percent of economic activity.Sales ofnew homes have also been
surging. They rose in June at their fastestpace in five years, to a seasonally adjusted annual rate of
497,000.Though new-home sales remain below the 700,000 pace consistent withhealthy markets, they’ve
risen 38 percent in the past 12 months.OnWednesday, Toll Brothers Inc., the luxury homebuilder, issued
an upbeatoutlook. The company said its signed contracts in the quarter that justended climbed 47
percent, and the average price of homes it deliveredrose 13 percent.Stocks of Toll and other builders
have generallyfallen since early spring on fears that higher mortgage rates will coolhome purchases
later this year.Copyright 2013 The Associated Press.