WASHINGTON (AP) -- A report Wednesday on U.S. sales of previously occupied homes in April may show the housing recovery has crossed a critical threshold.
Economists forecast that home sales rose in April from March to a seasonally adjusted annual rate of nearly 5 million, according to a survey by FactSet. If correct, that would mark the first time the pace has reached that point in 3½ years.
The National Association of Realtors will release the report at 10 a.m. EDT Wednesday.
Sales have gradually increased over the past year, helped by solid job gains and near record-low mortgage rates. In March, they were 10.3 percent higher than a year earlier.
Despite greater demand, many Americans remain hesitant to put their homes on the market. The number of available homes for sale in March was just 1.93 million. That's 17 percent lower than a year earlier. The tighter inventory was a key reason the sales pace slowed in March from February to just 4.92 million.
The Realtors group says they expect the supply increased in April. That's because sales typically pick up in spring.
Still, many of the sales are going to private investors, who are buying up lower-price homes and then renting them out.
First-time buyers, who help drive healthy markets, made up only 30 percent of sales in March. That's well below the 40 percent typical in a healthy market and down from nearly 33 percent in March 2012. Those buyers purchase from existing homeowners, who then are able to move on to larger houses.
Since the housing bubble burst more than six years ago, banks have imposed tighter credit conditions and required larger down payments. Those changes have left many would-be buyers unable to qualify for the super-low mortgage rates.
If home sales topped 5 million in April, that would be the first time that's happened since November 2009, when a home-buying tax credit boosted sales. And excluding that period, sales last exceeded 5 million in July 2007.
One reason economists expect the increase is a measure of signed contracts to buy homes rose in March to the highest level in three years. There is usually a one- to two-month between a signed contract and a completed sale.
Contract signings have increased 4.3 percent so far in 2013, according to economists at UBS, while sales of previously owned homes have barely increased. That also points to rising sales.
The housing recovery helped Home Depot Inc. post a big gain in first-quarter net income, the company said Tuesday. Its quarterly profits rose 18 percent. The company also raised its full-year revenue and earnings forecasts.
Rising demand and limited supply have encouraged builders to boost construction. Applications for building permits rose in April to the highest level in nearly five years. And U.S. builders started work on more new homes and apartments in April compared with the same month a year earlier.
