US home sales rose 3.9% in February as the struggling property market showed some signs of a rebound. The National Association of Realtors (NAR) said existing home  sales improved to an annualised pace of 6.69 million, well ahead of market expectations of a pace of 6.30 million.  The monthly report showed signs that lower prices -- following a  long boom in the property market that ended last year -- are  starting to stimulate sales.

The average sales price fell 1.3% to $212,800, which was the seventh decline in a row. The property market has been struggling as lending rates have increased and speculators have pulled out of what had been a  sizzling sector.

The latest data show existing home sales are still 3.6% below the 6.94 million-unit pace in February 2006, but last month's increase was the second in a row and the biggest monthly rise in  three years.