After declining to the slowest pace in more than three years, pending home sales increased last month. Out front of the rise was the Northeast.
The seasonally adjusted Pending Home Sales Index, a forward-looking indicator of home sales based on contract signings, was 107.5 as of February.
The index escalated by more than 3 percent from the downwardly revised level the preceding month — when it came in lower than it’s been since October 2014.
Still, pending home sales stood more than 4 percent below the downwardly revised reading the same month a year ago.
The National Association of Realtors
reported the index Wednesday.
“Contract signings rebounded in most areas in February, but the gains were not large enough to keep up with last February’s level, which was the second highest in over a decade,” NAR Chief Economist Lawrence Yun commented in the report. “The expanding economy and healthy job market are generating sizable homebuyer demand, but the miniscule number of listings on the market and its adverse effect on affordability are squeezing buyers and suppressing overall activity.”
Leading the increase was the Northeast, where the index jumped by more than a 10th from January — when it led the decline — to 96.0.
Pending home sale rose 3 percent in the South, bringing the index there to 125.7. The Midwest’s index was up nearly a percent to 98.9, while the West’s index was virtually unchanged at 96.9.
Yun warned that rising interest rates could deter some buyers due to the higher costs, while some sellers might hesitate in letting go of their currently low rates.
Yun predicts that home sales this year will be about the same as the approximately 5.51 million units sold last year.
