Pending home sales spiked in July on both a month-over-month and annual basis, and real estate experts don't expect the rate to slow anytime soon.
The Pending Home Sales Index increased 2.4 percent from the previous month and 12.4 percent from July 2011, to a mark of 101.7, according to the National Association of Realtors. An index of 100 represents a normal level of activity among homebuyers, and this upward shift could be a promising indicator for the housing market's recovery.
"While the month-to-month movement has been uneven, more importantly we now have 15 consecutive months of year-over-year gains in contract activity," said NAR chief economist Lawrence Yun.
A limited property supply could be an obstacle for the transaction rate in the future, Yun added. However, appreciating home prices could help owners come out from under negative equity and allow them to sell their properties without taking a loss.
Property data indicates existing-home sales to increase 8 to 9 percent by the end of 2012 from a year earlier, followed by an additional 7 to 8 percent gain during the course of 2013.