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MELISSA BLOCK, HOST:

As we watch the economy for signs of improvement, one key indicator is the housing market. And in real estate there's reason for optimism. Realtors are busy. The especially warm spring has brought buyers out earlier than usual.

NPR's Yuki Noguchi reports.

YUKI NOGUCHI, BYLINE: One of Doug Azarian's clients recently signed a deal on a $1.5 million house in Cape Cod. It's a contemporary waterfront property with three bedrooms.

DOUG AZARIAN: And the buyers came in and they loved it from the minute they walked in the door.

NOGUCHI: A few things are notable about that deal. First, it closed very quickly - the buyers didn't hem or haw. Also, it crossed the million-dollar price threshold. Azarian hasn't been able to say that too often since 2007. But now, he says, many of his high-end Wall Street clients are back. Buyer interest, sales volume, and average sale prices are all increasing.

AZARIAN: I believe activity is up probably anywhere from 25 to 50 percent over what it was a year ago. And by that, I mean people looking.

NOGUCHI: So, your own personal confidence is up.

AZARIAN: Yes.

NOGUCHI: That also appears to be true in many markets with less expensive homes. Lawrence Yun is chief economist for the National Association of Realtors.

LAWRENCE YUN: One thing that I'm very encouraged now versus, say, one year ago, two years ago, is that the recovery appears to be much more broad-based. Meaning that whether one goes from East Coast, Boston, to the West Coast, Seattle, sales activity is solidly higher. And the smaller markets, Peoria, Illinois, Greenville, South Carolina, and Chattanooga, Tennessee.

NOGUCHI: But the single most telling number Yun watches - and these days celebrates - is housing inventory. Home listings are down 26 percent from last year, close to healthy market levels.

Some worry that a recent settlement between banks and regulators will result in a flood of foreclosed homes hitting the market. But Yun says, in addition to the regular inventory, the so-called shadow inventory of homes in serious delinquency or in the foreclosure process is also down.

YUN: So, all three buckets of inventory, shadow inventories, are falling which is implying that this is a genuine reduction in inventory across the board.

NOGUCHI: Steve Brown says in Dayton, Ohio, his realty firm's revenue is up 27 percent from last year. Brown attributes this to what he calls meds, feds and eds. That is, job expansions at local hospitals, Wright-Patterson Air Force Base, and the University of Dayton.

Last weekend, one of his open houses drew 26 visitors - six times the average traffic from last year. He even expects competing offers.

STEVE BROWN: We haven't seen multiple offers on properties for four to five years, really.

NOGUCHI: Brown's firm can now invest in its business. It's adding new technology such as a text-messaging platform that notifies clients when new homes come on the market. It's also spending more on newspaper ads.

BROWN: All of that we've begun to do, because we feel more confident in the marketplace.

NOGUCHI: But for all that optimism, Brown says it's not exactly 2005 all over again; not in terms of the number of homes sold or their value.

BROWN: We are still not anywhere near the peak sales volume of pre-2006. At that time, our company was near a billion dollars in residential real estate sales. We are at half of that at this point in time.

NOGUCHI: Even so, some realtors would love to be in Brown's shoes.

WENDY FURTH: The market is still very difficult here.

NOGUCHI: Wendy Furth is a realtor in the San Fernando Valley of California. She says home prices continue to fall as foreclosures continue coming onto the market.

FURTH: It's not going at the rate of speed that it was before, but it certainly hasn't stopped yet.

NOGUCHI: Short sales and foreclosures make up 80 percent of Furth's business now, and those can prove difficult and frustrating. And yet...

FURTH: I have never been busier.

NOGUCHI: Cheap homes and low interest rates make more people willing to take a risk on the market, she says.

FURTH: They're out looking at properties and they're ready to buy right now. It's like their checkbooks are open and they're ready to go.

NOGUCHI: So, she's doing smaller deals but a lot more of them.

Yuki Noguchi, NPR News, Washington.

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