U.S. Pending Home Sales Unexpectedly Rebound In May

(RTTNews) - The National Association of Realtors released a report on Thursday showing an unexpected rebound by pending home sales in the U.S. in the month of May.

NAR said its pending home sales index jumped by 1.8 percent to 72.6 in May after tumbling by 6.1 percent to a revised 71.3 in April.

Economists had expected pending home sales to dip by 0.3 percent compared to the 6.3 percent plunge originally reported for the previous month.

"Consistent job gains and rising wages are modestly helping the housing market," said NAR Chief Economist Lawrence Yun. "Hourly wages are increasing faster than home prices."

He added, "However, mortgage rate fluctuations are the primary driver of homebuying decisions and impact housing affordability more than wage gains."

The rebound by pending home sales partly reflected strength in the West, where pending home sales surged by 6.0 percent.

Pending home sales in the Northeast also shot up by 2.1 percent, while pending home sales in the South jumped by 1.0 percent and pending home sales in the Midwest rose by 0.3 percent.

A separate report released by the Commerce Department on Wednesday showed a substantial pullback by new home sales in the U.S. in the month of May.

The Commerce Department said new home sales plunged by 13.7 percent to an annual rate of 623,000 in May after spiking by 9.6 percent to a revised rate of 722,000 in April.

Economists had expected new home sales to tumble by 7.1 to an annual rate of 690,000 from the 743,000 originally reported for the previous month.