Pending home sales in the U.S. surged by much more than expected in the month of March, according to a report released by the National Association of Realtors on Thursday.

NAR said its pending home sales index spiked by 3.4 percent to 78.2 in March after jumping by 1.6 percent to 75.6 in February. Economists had expected pending home sales to rise by just 0.3 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

“March’s Pending Home Sales Index – at 78.2 – marks the best performance in a year, but it still remains in a fairly narrow range over the last 12 months without a measurable breakout,” said NAR Chief Economist Lawrence Yun. “Meaningful gains will only occur with declining mortgage rates and rising inventory.”

Pending home sales in the South and West led the sharp monthly increase, soaring by 7.0 percent and 6.8 percent, respectively.

The report said pending home sales in the Northeast also jumped by 2.7 percent, while pending home sales in the Midwest plunged by 4.3 percent.

NAR also revealed it expects existing sales to surge by 9.0 percent to 4.46 million in 2024 and skyrocket by another 13.2 percent to 5.05 million in 2025.

“Home sales have lingered at 30-year lows, and since 70 million more Americans live in the country now compared to three decades ago, it’s inevitable that sales will rise in coming years,” explained Yun.

A separate report released by the Commerce Department on Tuesday showed a substantial rebound in new home sales in the U.S. in the month of March.

The Commerce Department said new home sales spiked by 8.8 percent to an annual rate of 693,000 in March after plunging by 5.1 percent to a revised rate of 637,000 in February.

Economists had expected new home sales to rise to an annual rate of 668,000 from the 662,000 originally reported for the previous month.

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