A leading indicator of existing-home sales edged up 1.3% in May, signaling that the housing market may be stabilizing after a long but gradual decline, according to the National Association of Realtors.The NAR's pending sales index rose from 111.9% in April to 113.4 in May. However, the index has been trending downward over the past eight months and is down 10.1% since May 2005. "The slight change in pending home sales indicates the market is beginning to level off," said NAR chief economist David Lereah. "We are entering the second phase of the transition period from the housing boom, in which sellers are becoming more realistic about their expectations -- sales are stabilizing and annual home price appreciation is returning to historic norms." Pending sales indicate that a contract has been signed and the sale is within one or two months of closing.

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