Pending home sales in the U.S. unexpectedly increased in the month of July, the National Association of Realtors revealed in a report released on Wednesday.
NAR said its pending home sales index climbed by 0.9 percent to 77.6 in July after rising by 0.4 percent to a revised 76.9 in June.
Economists had expected pending home sales to decrease by 0.6 percent compared to the 0.3 percent uptick originally reported for the previous month.
Pending home sales increased for the second consecutive month but were still down by 14.0 percent compared to the same month a year ago.
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.
“The small gain in contract signings shows the potential for further increases in light of the fact that many people have lost out on multiple home buying offers,” said NAR Chief Economist Lawrence Yun.
“Jobs are being added and, thereby, enlarging the pool of prospective home buyers,” he added. “However, rising mortgage rates and limited inventory have temporarily hindered the possibility of buying for many.”
The unexpected increase in pending home sales partly reflected strength in the West, where pending sales spiked by 6.2 percent. Pending home sales in the South also jumped by 2.0 percent.
Meanwhile, the report said pending home sales in the Midwest edged down by 0.4 percent, while pending home sales in the Northeast plunged by 5.8 percent.
“Interestingly, the West region experienced a meaningful price decline in the past year and buyers are quickly returning as a result,” Yun said.
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