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US pending home sales rebound: NAR

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US pending home sales rebound: NAR

Contracts to buy previously-owned US homes rebounded in March, recovering from a more than two-year low the previous previous month.

The pending home sales index rose 3.4 percent in March, following a revised drop of 0.5 percent the previous month, the National Association of Realtors reported today.

Compared to March 2013, pending home sales were down 7.9 percent, following an annualized drop of 10.5 percent the previous month that was also the lowest since April 2011.

Pending home sales are a key indicator of US housing activity. They allow economists to forecast the pace of existing home sales, which are based on contract closings.

“After a dismal winter, more buyers got an opportunity to look at homes last month and are beginning to make contract offers,” said NAR chief economist Lawrence Yun in a press release. “Sales activity is expected to steadily pick up as more inventory reaches the market, and from ongoing job creation in the economy.”

The sale of previously-owned homes is expected to total 4.9 million this year, below last year’s nearly 5.1 million sales, the NAR said. Ongoing inventory shortages are expected to shore up house prices by as much as 7 percent in 2014.

The latest reading of the S&P/Case-Shiller Home Price Index, which monitors residential price changes in 20 regions across the US, will be released Tuesday.

The US housing sector hit a rough patch this winter, as inclement weather reduced buyer traffic and overall activity. The housing sector has been under pressure since last summer, when rising mortgage rates served as a disincentive for many potential home-buyers.

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