Signed contracts to buy US homes rise to 18-month high

WASHINGTON (AP) — The number of Americans signing contracts to buy homes rose at a healthy pace in January, a sign that home sales are poised to accelerate after a slow start to the year.

The National Association of Realtors said today that its seasonally adjusted pending home sales index increased 1.7 percent to 104.2 last month. December's figure was also revised higher to show a decline of only 1.5 percent, considerably better than a previously estimated drop of 3.7 percent.

The index is now 8.4 percent above its level one year ago and is at the highest level since August 2013.

The data point to a rebound in sales of existing homes in the coming months, particularly as the spring buying season gets underway. Measures of sales and construction fell last month, raising concerns that the housing market would continue to struggle after a weak 2014. But economists expect that strong job gains, low mortgage rates and solid consumer confidence will give a moderate boost to home sales this year.

"Through the volatility, the trend in home sales is probably up modestly at least," Jim O'Sullivan, chief U.S. economist at High Frequency Economics, said in a note to clients.

Pending sales are a barometer of future purchases. A one- to two-month lag usually exists between a contract and a completed sale.