Pending home sales in the U.S. plunged by much more than expected in the month of February, according to a report released by the National Association of Realtors on Wednesday.
NAR said its pending home sales index plummeted by 10.6 percent to 110.3 in February after tumbling by 2.4 percent to a revised 123.4 in January.
Economists had expected pending home sales to slump by 2.6 percent compared to the 2.8 percent dive originally reported for the previous month.
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 demand for a home purchase is widespread, multiple offers are prevalent, and days-on-market are swift but contracts are not clicking due to record-low inventory," said Lawrence Yun, NAR's chief economist.
"Only the upper-end market is experiencing more activity because of reasonable supply," he added. "Demand, interestingly, does not yet appear to be impacted by recent modest rises in mortgage rates."
The steep drop in pending home sales reflected notable decreases in all four regions of the country, with pending sales in the South leading the way lower with a 13.0 percent nosedive.
Pending home sales in the Midwest and Northeast also plunged by 9.5 percent and 9.2 percent, respectively, while pending sales in the West tumbled by 7.4 percent.