Pending home sales in the U.S. went up 3.4 percent in March 2014 making it the first gain in the past nine months, the National Association of Realtors (NAR) announced Monday.
The pending home sales index is a tool that gauges the number of homes that have gone under contract for sale. The index went up 3.4 percent to 97.4 from February. The increase was 1 percent more of what economists had predicted. However, it is still 7.4 percent lesser than a year earlier.
Stats Breakdown
Pending home sales shot up 5.7 percent to 91.0 in the Western states. However, it is 11.1 percent lesser than the figures of March 2013.
The index rose 5.6 percent to 112.7 in the Southern states but was still 5.3 percent lower than a year earlier.
While the index inched up 1.4 percent to 78.8 in the Northeastern states, it dipped 0.8 percent to 94.5 in the Midwest - the only region to witness a decline in March. Values were 5.9 percent and 10.1 percent below figures of March 2013, for each region respectively.
Sunny Spring
The rise in the number of pending home sales could indicate a steady growth in the housing market. The chilly winter in January and February dampened home sales but the spring market looks sunny.
"After a dismal winter, more buyers got an opportunity to look at homes last month and are beginning to make contract offers. Sales activity is expected to steadily pick up as more inventory reaches the market, and from ongoing job creation in the economy," Lawrence Yun, chief economist at NAR, said in a statement.
"The stronger pending home sales report hints at resurgence in housing market momentum during the typically busier spring buying season," Gennadiy Goldberg, a strategist at TD Securities told Reuters.
More recently, the NAR released its March housing market report. It revealed that existing home sales were relatively flat with prices edging up higher. However, the silver lining was the slight increase in supply. Experts believe that the market will gain traction in the coming few months.
"The bulk of housing data points a slow recovery in the sector following the successive shocks of higher mortgage rates and worsening affordability last year and adverse weather this year," Michael Gapen, economist at Barclays told The Wall Street Journal.