Market Rebounding as Pending Home Sales Rise 4.1 Percent in March

According to the National Association of Realtors (NAR), pending home sales increased in March and are well above a year ago, another signal the housing market is recovering. The Pending Home Sales Index (PHSI), a forward-looking indicator based on contract signings, rose 4.1 percent to 101.4 in March from an upwardly revised 97.4 in February and is 12.8 percent above March 2011 when it was 89.9. The data reflects contracts but not closings. The index is now at the highest level since April 2010 when it reached 111.3. “First quarter sales closings were the highest first quarter sales in five years," said Lawrence Yun, NAR chief economist. "The latest contract signing activity suggests the second quarter will be equally good." The PHSI in the Northeast slipped 0.8 percent to 78.2 in March, but it stands 21.1 percent above March 2011. In the Midwest, the PHSI slid to 0.9 percent to 93.3, but is 16.9 percent higher than a year ago. Pending home sales in the South rose 5.9 percent to an index of 114.1 in March and are 10.6 percent above March 2011. In the West, the PHSI increased 8.7 percent in March to 108.0 and is nine percent above a year ago. “The housing market has clearly turned the corner," said Yun. "Rising sales are bringing down inventory and creating much more balanced conditions around the county, which means home prices will be rising in more areas as the year progresses."