The National Association of Realtors (NAR) announced on Wednesday its seasonally adjusted pending home sales index (PHSI) jumped 8.8 percent m-o-m to 132.8 (a record high) in August, after a 5.9 percent m-o-m jump in July.

Economists had expected pending home sales to advance 3.4 percent m-o-m in August.

On y-o-y basis, the index surged 24.2 percent after a 15.5 percent climb in July. This was the biggest gain since October 2009.

According to the report, all four regional indices recorded gains in contract activity on both m-o-m and y-o-y basis in August. The Northeast PHSI rose 4.3 percent m-o-m to 117.1 in August, a 26.0 percent jump from a year ago. In the Midwest, the index increased 8.6 percent m-o-m to 124.5 last month, up 25.0 percent from August 2019. Pending home sales in the South surged 8.6 percent m-o-m to an index of 154.2 in August, up 23.6 percent from August 2019. The index in the West jumped 13.1 percent m-o-m in August to 120.3, up 23.6 percent from a year ago.

"Tremendously low mortgage rates - below 3% - have again helped pending home sales climb in August," noted Lawrence Yun, NAR’s chief economist. "Additionally, the Fed intends to hold short-term fed funds rates near 0% for the foreseeable future, which should in the absence of inflationary pressure keep mortgage rates low, and that will undoubtably aid homebuyers continuing to enter the marketplace."