WASHINGTON (Reuters) - Contracts to buy previously owned U.S. homes rose to their highest level in just over nine years in May, in a further boost to the housing market and the broader economic outlook.
The National Association of Realtors said on Monday its Pending Home Sales Index, based on contracts signed last month, increased 0.9 percent to 112.6, the highest level since April
2006. Contracts have now increased for five straight months.
Pending home contracts become sales after a month or two, and last month's increase pointed to further gains in home resales after they hit a 5-1/2-year high in May. Economists had forecast pending home sales rising 1.2 percent last month.
The housing market recovery is back on track after being slammed by bad weather at the start of the year. It is being bolstered by a tightening labor market, which is helping to spur some pick-up in wage growth.
Pending home sales increased 10.4 percent from a year ago.
Contracts increased 6.3 percent in the Northeast and rose 2.2 percent in the West. They slipped 0.8 percent in the South and dipped 0.6 percent in the Midwest.
(Reporting By Lucia Mutikani; Editing by Andrea Ricci)
