California Pending Home Sales Reverse Two-Month Decline

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Pending home sales in California increased in January, reversing a two-month decline, according to the California Association of Realtors.

In January, the pending home index - based on signed contracts and not closings -- jumped 22.9 percent to reach 84.8, up from a revised index of 68.9 in December.

"We're starting to see a turning point in the market as we approach the spring home buying season," CAR. president Kevin Brown, said in the report. "Home sellers realize that home prices are holding steady and are gearing up for the upcoming season by listing their homes for sale, while prospective home buyers are getting more comfortable with stabilizing home prices and interest rates and are entering the market."

However, compared to a year ago, the pending sales index dropped 17.5 percent from the revised 102.8 in January 2013. This marks the fifth consecutive month of annual double-digit declines.

Last week, CAR announced a drop in existing-home sales, due to a limited supply of homes.

The share of equity sales reached a recent high in November. In January, the share remained essentially the same, but still marked the seventh consecutive month that equity sales have been more than 80 percent of all sales.

In January, equity sales reached 84.4 percent, down from 84.5 percent in December. Equity sales represented 64.2 percent of all sales in January.

The share of distressed property sales increased slightly from 15.5 percent in December to 15.6 percent last month. However, they were down by more than half from a year ago, according to the report.

Property listings increased in January, bringing the supply for equity sales from three months to 4.4 months.