Contract signings on existing-home sales were up in March, rising 4.1% on a monthly basis, according to data released today from the National Association of Realtors (NAR). The change brought NAR’s Pending Home Sales Index up four points to a reading of 101.4, 12.8% above its year-ago level.

"First-quarter sales closings were the highest first-quarter sales in five years. The latest contract signing activity suggests the second quarter will be equally good," said Lawrence Yun, NAR’s chief economist, in a statement discussing the numbers.

However, the pending sales represent contracts signed, not closings, leaving the deals open to cancellations. In the past, NAR published the percentage of Realtors who reported contract cancellations, but in April it ceased providing that statistic, saying that since "many buyers are staying in the market and offering another contract … sales have been holding up much better than the fallout rate would imply." Earlier this year, the rate stood above 30%, compared to 9% in early 2011.

However, whether it manifests itself as a cancellation or in another way, "the biggest thing is credit," said Patrick Newport, U.S. economist at IHS Global Insight, on a call with Builder. "And I don’t see that changing," given the FHFA’s mandate to minimize the loss of government funds, he says. "Sales are improving, but I don’t think they’re going to be much better this year than last year."

To read the National Association of Realtors’ full release regarding pending home sales in March, click here.

Claire Easley is a senior editor at Builder.

Learn more about markets featured in this article: Greenville, SC.