Pending sales of existing homes for April rose 3.4 percent from March, to the highest level in nine years, according to figures released Thursday by the National Association of Realtors. Pending sales are now up 14 percent from a year ago.
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New home sales are also on the rise, jumping 6.8 percent in April to a seasonally adjusted annual rate of 517,000 units, the Commerce Department said Tuesday. That spike was higher than analysts had expected.
Meanwhile, the closely-watched S&P/Case-Shiller Index showed housing prices in 20 cities climbed 5 percent year-over-year in March.
Supply is still tight, and buyers are flooding into the market trying to beat mortgage rate increases, Kelman noted. Many market watchers expect the Federal Reserve to begin raising interest rates in September, which will push up mortgage rates.
"Most of the buyers we talk to are really frustrated because they're getting into bidding wars, not just with two or three other buyers but with 5, 10 ,15 buyers," he said.
"Some of our markets are saying this is crazier than we ever saw in 2007, 2006 so really we're going to see stronger price increases over the next two or three months than we saw previously," Kelman added.
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Despite soaring prices, most economists are not yet convinced the housing market is in bubble territory. That's most likely because they're starting from such a low base: in the wake of the 2008 crisis, housing fell into depression territory, as prices swooned by more than 30 percent from peak to trough.
However, he thinks sooner or later prices are going to get ahead of what people are willing to pay and mortgage rates will begin to rise.
"We think that when rates go up, buyers are going to take a step back and we're not going to see the same appreciation," he said. "The people who are borrowing money need to get into the market. But if you're not borrowing money it might be better to sit back and wait until the fall."
—Reuters contributed to this report.