(fxcue news) - Pending home sales in the U.S. saw a significant rebound in the month of February, the National Association of Realtors revealed in a report on Thursday. NAR said its pending home sales index surged by 2.0 percent to 72.0 in February after plunging 4.6 percent to an all-time low of 70.6 in January. Economists had expected pending home sales to jump by 1.5 percent. "Despite the modest monthly increase, contract signings remain well below normal historical levels," said NAR Chief Economist Lawrence Yun. He added, "A meaningful decline in mortgage rates would help both demand and supply - demand by boosting affordability, and supply by lessening the power of the mortgage rate lock-in effect." The rebound by pending home sales largely reflected a sharp increase in the South, where pending home sales spiked by 6.2 percent. Pending home sales in the Midwest also rose by 0.7 percent, but pending home sales in the Northeast slid by 0.9 percent and pending home sales in the West tumbled by 3.0 percent. In its quarterly economic forecast, NAR said it expects mortgage rates will average 6.4 percent in 2025 and 6.1 percent in 2026 "Considering the Federal Reserve's recent forecast for slower economic growth, we expect mortgage rates to slide moderately lower," said Yun. "But the current high national debt will prevent mortgage rates from falling drastically - and certainly not to the 4%-to-5% range seen during President Trump's first term." NAR also said it expects existing home sales to increase by 6 percent in 2025 and accelerate another 11 percent in 2026. The association predicts the national median home price will rise by 3 percent in 2025 and 4 percent in 2026. "Home price growth will moderate due to more supply coming onto the market," added Yun. "Having income and wages rise faster than home prices are welcome to improve affordability."