February 27, 2020 / 4:41 PM / a month ago

U.S. pending home sales jump 5.2% in January

WASHINGTON (Reuters) - Contracts to buy previously owned U.S. homes rebounded in January to their second-highest monthly figure in about two years as low mortgage rates boosted sales.

The National Association of Realtors said on Thursday its pending home sales index rose 5.2% to a reading of 108.8 last month. December’s index was slightly upwardly revised. Compared to one year ago, pending home sales were up 5.7%.

Economists polled by Reuters had forecast pending home sales would increase 2.2% in January. Pending home contracts are seen as a forward-looking indicator for the wellbeing of the housing market because they become sales within a couple of months.

In January, contracts rose across three of the nation’s four regions. Pending home sales jumped 8.7% in the South and 7.3% in the Midwest. They also rose 1.3% in the Northeast but fell 1.1% in the West.

“With housing starts hovering at 1.6 million in December and January, along with the favorable mortgage rates, among other factors, 2020 has so far presented a very positive sales climate,” Lawrence Yun, the NAR’s chief economist, said in a statement.

Reporting by Lindsay Dunsmuir; Editing by Paul Simao

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