The National Association of Realtors (NAR) announced on Wednesday its seasonally adjusted pending home sales index (PHSI) surged 8.1 percent m-o-m to 119.5 in August, after a revised 2.0 percent m-o-m decrease in July (originally a 1.8 percent m-o-m decline).

Economists had expected pending home sales to increase 1.4 percent m-o-m in August.

On y-o-y basis, the index plunged 8.3 percent after an unrevised 8.5 percent tumble in July. 

According to the report, all four regional indices recorded m-o-m gains in August, but each index showed a decline from a year ago.

The Northeast PHSI rose 4.6 percent m-o-m to 96.2 in August, a 15.8 percent decrease from a year ago. In the Midwest, the index surged 10.4 percent m-o-m to 115.4, down 5.9 percent from August 2020. Pending home sales in the South jumped 8.6 percent m-o-m to an index of 141.8 in August, down 6.3 percent from August 2020. The index in the West climbed 7.2 percent m-o-m in August to 107.0, but still down 9.2 percent from a year prior.

"Rising inventory and moderating price conditions are bringing buyers back to the market," noted Lawrence Yun, NAR's chief economist. "Affordability, however, remains challenging as home price gains are roughly three times wage growth."