Existing home sales in March leaped to their fastest pace in 18 months, making a well-timed upturn at the start of the peak spring buying season.
Sales rose 6.1% -- the largest increase since December 2010 -- to a seasonally adjusted annual rate of 5.19 million, the National Association of Realtors said Wednesday.
Economists' median forecast for March sales' rate was 5.03 million, according to Action Economics' survey.
Monthly sales last topped a 5 million annual rate in December, and March's rate was the highest since October's 5.16 million.
NAR's figures cover completed transactions on single-family homes, town homes, condominiums and co-ops.
Total inventory at the end of March rose 5.3% to 2 million existing homes available for sale, and 2% above a year ago, NAR said. Unsold inventory is at a 4.6 months' supply, down slightly from 4.7 months in February.
That indicates the supply of homes for sale is still tight. A six-month supply is considered a market balanced between buyers and sellers.
Other recent signs have pointed to a pick-up in sales. The NAR's seasonally adjusted pending home sales index hit its highest level since June 2013 in February. The index tracks signings of contracts to buy homes and is an indicator of future sales one or two months later.
Sales of previously owned homes fell 2.9% last year from 2013, but prices also rose more slowly -- at 5.7%, about half the rate in the previous year. NAR predicts average prices will rise a similar amount this year.
NAR's report Wednesday showed median prices rose 7.8% from March 2014, accelerating from a 2.6% rate in February to its fastest pace in a year, TD Economics' Michael Dolega said in a research note Wednesday morning. Single-family homes led the price gains; values increased 8.7% from the previous year, he said.
"The report was an uplifting one, especially after months of disappointments during the harsh winter," Dolega said.
He predicts existing home sales will see their best year of the economic recovery in 2015, rising to nearly a 5.5 million rate later this year.
A separate report from the Federal Housing Finance Agency Wednesday said U.S. house prices rose 0.7% in February on a seasonally adjusted basis from January. FHFA's housing price index was 2.9% below its March 2007 peak and about the same as in January 2006.
FHFA's index is based on mortgages sold to or guaranteed by Fannie Mae and Freddie Mac, which FHFA regulates.
Mortgage rates also are still near their lows for the year. The average interest rate on a fixed, 30-year mortgage was 3.67% last week, down from 4.27% a year ago, according to Freddie Mac's latest weekly survey.