Pending home sales rose 8.2% in May
Pending home sales rose 8.2% in May after experiencing a downturn in April, with contract activity rising above year-ago levels for the first time since April 2010, the National Association of Realtors said Wednesday. The huge trade association, which has more than 1.2 million members, said its pending home sales index, which is based on the number of contracts signed to purchase previously owned homes, rose to 88.8 in May, 13.4% higher than 78.3 a year earlier and up from 82.1 in April. "Absorption of inventory is the key to price improvement, and this solid gain in contract signings implies that home values in many localities are or will soon be stabilizing as inventories get absorbed at a faster pace," NAR Chief Economist Lawrence Yun said. "Some markets have made a rapid turnaround, going from soft activity to contract signings rising by more than 30% from a year ago, including areas such as Hartford, Conn.; Indianapolis; Minneapolis; Houston; and Seattle," Yun said. Overall, May was a turnaround month considering pending home sales fell substantially in April due to unusual weather and continued uncertainty in the housing market. Write to: Kerri Panchuk.