By Vicki Needham - 05/29/14 05:22 PM EDT
Pending home sales rose for the second straight month in April, a sign that housing market is emerging from the rough winter.
A gauge of contract signings increased 0.4 percent to 97.8 in April from 97.4 in March, but is 9.2 percent below April 2013 when it was 107.7, the National Association of Realtors (NAR) said Thursday.
“Higher inventory levels are giving buyers more choices, and a slight decline in mortgage interest rates this spring is raising prospective home buyers’ confidence,” said Lawrence Yun, NAR chief economist.
"An uptrend in closed sales is expected, although some months will encounter a modest setback."
Yun projects the 30-year fixed-rate mortgage to rise to about an average 5.5 percent next year.
“The extent to which higher mortgage interest rates will impact housing affordability and sales depends on income growth, ongoing improvement in the labor market and any change to mortgage underwriting conditions," he said.
Regionally, the index in the Northeast increased 0.6 percent to 79.3 in April, but is 12 percent below a year ago.
In the Midwest, pending sales rose 5 percent to 99.2 in April, but is 6.9 percent below April of last year.
Pending home sales in the South slipped 0.6 percent to an index of 111.9 in April, and are 6.4 percent below a year ago.
The index in the West declined 2.9 percent in April to 88.4, and is 15 percent below April 2013.
After a slow start to the year, annual existing-home sales are expected to be modestly below the nearly 5.1 million in 2013, but should be close to 5.3 million in 2015.
The national median existing-home price is projected to grow between 5 and 6 percent this year, and in the range of 4 to 5 percent in 2015.