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The National Association of Realtors (NAR) this morning released its data on pending home sales in January. The index rose 4.5% from a downwardly revised 101.3 in December to 105.9, and it is 9.5% higher than in January 2012 when the index reading was 96.7. The consensus estimate called for an increase of 3% in sales.

The index reflects signed contracts, not sales closings. An index reading of 100 equals the average level of contract signings during 2001.

The NAR’s chief economist noted:

Favorable affordability conditions and job growth have unleashed a pent-up demand. Most areas are drawing down housing inventory, which has shifted the supply/demand balance to sellers in much of the country. It’s also why we’re experiencing the strongest price growth in more than seven years.

Sales rose in every region of the country. Pending sales rose most in the Northeast — up 8.2% compared with December. In the Midwest, sales improved just 4.5% from December, and sales in the South rose 5.9%. The Midwest and Northeast regions are up 17.7% and 10.5%, respectively, year-over-year, and the South is up 11.3%.

The West region continues to be constrained by an inventory shortage. Pending sales rose just 0.1% from December and are 1.5% below sales in January 2012.

The NAR noted that pending home sales are at their highest level since April 2010.