(Bloomberg News) Sales of existing homes climbed in July from an eight-month low, adding to signs U.S. housing may pick up in the second half.

Purchases of previously owned houses, tabulated when a contract closes, increased 2.3 percent to a 4.47 million annual rate, figures from the National Association of Realtors showed today in Washington. The data were posted on the group's website ahead of the usual 10 a.m. release time. The median forecast of 73 economists surveyed by Bloomberg called for a rise to a 4.51 million rate.

Buoyed by cheaper properties and record-low mortgage costs, demand for real estate is bolstering the industry that helped trigger the recession. Minutes of the Federal Reserve's latest meeting, due later today, will be a reminder that policy makers are monitoring data such as housing to determine whether the world's largest economy needs more stimulus.

"We'll see further improvement in housing this year," Richard Moody, chief economist at Regions Financial Corp. in Birmingham, Alabama, said before the report. "The two keys are going to be the pace of job growth and whether we see more easing in mortgage lending standards."

Estimates in the Bloomberg survey ranged from 4.3 million to 4.8 million. The prior month's pace was unrevised at 4.37 million, the lowest since October.

Median Price

The median price of an existing home jumped 9.4 percent from a year earlier, the biggest 12-month gain since January 2006, to $187,300 from $171,200 in July 2011, today's report showed.

Compared with a year earlier, purchases increased 11 percent before adjusting for seasonal variations.

The number of previously owned homes on the market climbed 1.3 percent to 2.4 million. At the current sales pace, it would take 6.4 months to sell those houses compared with 6.5 months at the end of the prior month.

Purchases increased in three of four regions, led by a 7.4 percent gain in the Northeast. Purchases in the West were unchanged.

Minutes of the Fed's latest meeting, due later today, will be a reminder that policy makers are monitoring data such as housing to determine whether the world's largest economy needs more stimulus.

Fed's View

The central bank has said it will "closely monitor" economic data and financial developments, according to a statement after its July 31-Aug. 1 gathering, at which policy makers determined they "will provide additional accommodation as needed" to accelerate the expansion.

"Despite some further signs of improvement, the housing sector remains depressed," the Fed statement also said.

Existing-home sales have improved since reaching a low of 3.39 million at an annual rate in July 2010. In the buildup to the subprime lending collapse and recession, purchases reached a peak of 7.25 million in September 2005.

Sales of new homes, counted when contracts are signed, may have rebounded to a 365,000 annual rate in July from 350,000 the prior month, the survey median showed ahead of Commerce Department figures due tomorrow.

Newly constructed houses accounted for 6.7 percent of the residential market in 2011, down from a high of 15 percent during the boom of the past decade. Resales made up the rest.

Improving Profits

Construction companies are noting the increase in demand. PulteGroup Inc., the largest U.S. homebuilder by revenue, posted a better-than-estimated profit and a 32 percent jump in orders in the second quarter. AV Homes Inc., which develops properties in Florida and Arizona, said it closed on 41 percent more houses in the second quarter compared to a year earlier, and contracts signed, net of cancellations, more than doubled.

"The housing market continues to gain momentum," Allen Anderson, chief executive officer of AV Homes, said on an Aug. 7 earnings conference call. "We are no longer battling the headwinds of the housing recession."

Reports last week confirmed housing is improving. Building permits, a proxy for future work, jumped to a four-year high in July even as residential starts fell from the fastest pace in more than three years. The National Association of Home Builders/Wells Fargo index of builder confidence rose in August to the highest level since 2007.

Homes are more affordable. The average rate on a 30-year fixed mortgage dropped to 3.49 percent in the week ended July 26, the lowest in records dating to 1971, according to McLean, Virginia-based Freddie Mac.

Foreclosures are abating, though they still pose a threat as borrowers struggle to pay bills. The mortgage delinquency rate, or the share of home loans at least 30 days late, rose in the second quarter from the previous three months, the first gain in a year, the Mortgage Bankers Association reported.