After reporting a sharp pullback in U.S. pending home sales over the two previous months, the National Association of Realtors released a report on Thursday showing pending home sales rebounded in the month of March.
NAR said its pending home sales index jumped by 1.9 percent March after plunging by 11.5 percent to a revised 109.2 in February.
Pending home sales rebounded from their lowest level since last May, although economists had been expecting a more substantial increase of about 5.0 percent.
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.
"The increase in pending sales transactions for the month of March is indicative of high housing demand," said Lawrence Yun, NAR's chief economist. "With mortgage rates still very close to record lows and a solid job recovery underway, demand will likely remain high."
"Low inventory has been a consistent problem, but more inventory will show up as new home construction intensifies in the coming months, as well as from a steady wind-down of the mortgage forbearance program," he added
The rebound in pending home sales was partly due to strong growth in the North, where pending sales spiked by 6.1 percent.
Pending home sales in both the South and West also jumped by 2.9 percent, while pending sales in the Midwest tumbled by 3.7 percent.
Looking ahead, NAR said existing home sales are projected to soar by 10 percent to 6.2 million in 2021. The median home price is expected to surge up by 9 percent to $323,900.