The housing market is showing early signs of recovery with pending sales of U.S. homes climbing for the first time in a year, according to new data from Redfin.

Pending home sales rose 3% in December, the first month-over-month increase since October 2021, Redfin said in a report Wednesday. There are other indicators that demand is stirring back to life, including bidding wars, more requests for home tours and a growing number of people contacting the brokerage firm to start the home buying process.

“I’ve seen more homes go under contract this month than in the entire fourth quarter,” said San Jose, Calif., Redfin agent Angela Langone. “Listings that were stagnant in November and December are suddenly getting one to two offers.”

The interest rate-sensitive housing market has borne the brunt of the Federal Reserve’s aggressive campaign to tighten policy and slow the economy.

It’s great news to hear that pending home sales are increasing for the first time in more than a year! This is a positive sign that the housing market is beginning to recover and that demand is returning. Low interest rates have made it more attractive for potential buyers to purchase homes, which has likely contributed to the uptick in pending home sales. As a result, real estate agents are seeing more homes going under contract, more requests for home tours, and an increase in people contacting brokerages to start the home buying process. All of this is a positive step forward in the housing market!