The numbers: Pending home sales rose for the second straight month in September, helped by lower mortgage rates, a trade group said Tuesday.
The National Association of Realtors said pending home sales climbed 1.5%. Economists expected a 0.7% gain, according to a survey by Econoday.
Compared to 12 months ago, sales jumped 3.9%. In August, sales rose a revised 1.4%.
The index captures transactions where a contract has been signed, but the home sale has not yet closed.
What happened: The four major regions were split last month, as the Midwest and South showed gains but the Northeast and West reported declines.
The Case-Shiller home-price report also released Tuesday showed a drop in house prices in August.
Big picture: The Federal Reserve’s two interest rate cuts this year is starting to impact the housing sector. Low mortgage rates played a role in the two straight months of gains in pending home sales, said Lawrence Yun, the NAR’s chief economist, in a statement. He said that national buying power has increased by 6% because of better interest rates. Contract signings would be higher if more housing was available, he added.
Market reaction: Stocks were mixed in early trading with the Dow Jones Industrial Average showing slight gain while the S&P 500 index was lower after hitting a record high on Monday.