Pending Home Sales Jump Higher

The number of pending home sales in February sharply grew at a pace well ahead of what economists had expected, as the tepid housing recovery shows a much-needed signal of growth after a weak winter season.

The National Association of Realtors reported Monday that the seasonally adjusted index of sales agreements increased by 8.2 percent in February from the prior month to a reading of 97.6. The reading for January was slightly revised downward to 90.2.

Economists had expected the index to remain flat for February at 90.3 for the index that gauges future sales in the U.S. housing market. A reading of 100 would be equivalent to the time when the index started in 2001.

The strongest gain for February was seen in the Midwest, where pending sales grew almost 22 percent. Sales also rose 9 percent in the South and Northeast.

A drop of 5 percent was seen in the West, but the region did show a 14.6 percent boost in pending home sales from same month last year.

Sales in recent months had been tempered after the government extended the first-time homebuyer tax credit of $8,000 and the existing homeowner break of $6,500 to April 30. Potential homebuyers had been less rushed to get in on the incentive, but demand for the tax credits as the deadline grows near.

The news on Monday was much needed for a housing sector that had seen home resales fall for three consecutive months as the high unemployment rate and sluggish wage growth.