U.S. pending home sales climb to nearly two-year high in March
NAR said its pending home sales index climbed 1.1 percent to 108.6 in March from an upwardly revised 107.4 in February. Economists had been expecting the index to increase by about 1.0 percent.
The pending home sales index is up by 11.1 percent compared to the same month a year ago and is now at its highest level since reaching 109.4 in June of 2013.
A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.
Lawrence Yun, NAR chief economist, said, "Demand appears to be stronger in several parts of the country, especially in metro areas that have seen solid job gains and firmer economic growth over the past year."
"While contract activity being up convincingly compared to a year ago is certainly good news, the increased number of traditional buyers who appear to be replacing investors paying in cash is even better news," he added. "It indicates this year's activity is being driven by more long-term homeowners."
The continued increase in pending home sales was partly due to notable growth in the South, where pending sales jumped by 4.0 percent.
Pending home sales in the West also rose by 1.7 percent, while pending sales in the Northeast and Midwest fell by 1.5 percent and 2.5 percent, respectively.
Last Wednesday, NAR released a separate report showing that existing home sales increased by much more than expected in the month of March.
NAR said existing home sales surged up 6.1 percent to an annual rate of 5.19 million in March after rising 1.5 percent to a revised 4.89 million in February. Economists had expected existing home sales to climb to a rate of 5.05 million.
With the bigger than expected increase, existing home sales rose to their highest level since reaching a matching rate in September of 2013. ■