A sharp jump in interest rates may have deterred some home buyers in May. Signed contracts to buy existing homes, so-called pending home sales, rose just 0.9 percent in May from April, according to the National Association of Realtors, after a downward revision to April's reading. That is slightly lower than analysts predicted, but is still the highest level on the association's index since April of 2006. Pending sales are now 10.4 percent higher than one year ago.
"The steady pace of solid job creation seen now for over a year has given the housing market a boost this spring," said Lawrence Yun, chief economist for the Realtors. "It's very encouraging to now see a broad based recovery with all four major regions showing solid gains from a year ago and new home sales also coming alive."