Pending Home Sales increased in may 2011

According to the most recent data released by the National Association of Realtors, the number of pending home sales recorded in May experienced the greatest increase since November.

Overall, the number of contract signings during May grew by 8.2 percent from April and 13.4 percent from May 2010. The increase marks the seventh time the index has grown in the last 11 months. April was one of these down months, as the total decreased 11 percent.

"This solid gain in contract signings implies that home values in many localities are or will soon be stabilizing as inventories get absorbed at a faster pace," said NAR chief economist Lawrence Yun.

The index's increase was much higher than the 3.8 percent estimate many economists had forecast.

The higher yearly total can be attributed to the first-time homebuyers tax credit, which drew an increased number of property seekers during April 2010. After the April 30 deadline, however, the number of interested homebuyers declined significantly.

As pending sales were up nationally, areas with improving job sectors could experience even further gains. Thus, the Houston real estate market could show significant growth soon as more jobs are created.