Previously-owned home purchases climbed 3.7% to a 5.1 million annual rate in March as a mounting supply of properties in or near foreclosure lured investors, a National Association of Realtors report showed April 20. All-cash deals accounted for 35% of the transactions, the most on record, while distressed properties including foreclosures and short sales made up 40% of all deals, the group said.

Existing-Home Sales

New-home sales are considered a more timely barometer than purchases of previously owned homes, which are calculated when a contract closes. Resales account for about 95% of the housing market so far this year.

Housing demand gyrated in 2010, reflecting a boost from a homebuyer tax incentive of as much as $8,000 that gave way to a plunge in sales by mid-2010 after the credit ended.

While sales have steadied, they have yet to strengthen, keeping builders pessimistic. The National Association of Home Builders' confidence index fell to 16 this month from 17 in March. A reading under 50 means a majority of builders view conditions as poor.

KB Home

KB Home, the Los Angeles-based homebuilder that targets first-time buyers, reported a bigger-than-expected loss for the quarter ended Feb. 28 as orders plunged.

"A sustained, broad-based housing recovery will not occur until we start to experience material job creation," Chief Executive Officer Jeffrey Mezger said during a conference call with analysts on April 5.

An unemployment rate projected to average 8.7% in 2011, according to a Bloomberg survey earlier this month, may restrain demand and lead to more distressed properties. Foreclosure filings will climb about 20% in 2011, reaching a peak for the housing crisis, according to a forecast in January from RealtyTrac Inc., an Irvine, Calif.-based data seller.

The housing market was either "little changed from low levels" or weaker across the country, the Fed said in its Beige Book report on April 13. The lack of a sustained housing rebound is among reasons policy makers will complete their $600 billion asset purchase plan and hold borrowing costs near zero to spur growth.