(RTTNews) - Pending home sales in the U.S. jumped by much more than expected in the month of July, the National Association of Realtors revealed in a report on Thursday.
NAR said its pending home sales index spiked by 5.9 percent to 122.1 in July after soaring by 15.8 percent to 115.3 in June. Economists had expected pending home sales to surge up by 3.0 percent.
Pending home sales increased for the third straight month after plummeting in March and April and are now up by 15.5 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.
"We are witnessing a true V-shaped sales recovery as homebuyers continue their strong return to the housing market," said NAR chief economist Lawrence Yun.
He added, "Home sellers are seeing their homes go under contract in record time, with nine new contracts for every 10 new listings."
The bigger than expected jump in pending home sales reflected growth in all four regions, with pending sales in the Northeast skyrocketing by 25.2 percent.
Pending home sales also surged by 6.8 percent and 3.3 percent in the West and Midwest, respectively, while pending sales in the South edged up by 0.9 percent.
Yun expects existing home sales to ramp up to 5.8 million in the second half, bringing the full-year level of existing home sales to 5.4 million, reflecting a 1.1 percent increase compared to last year.
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