Closed home sales increased 17.7 percent to 677 last month, compared to 575 in July 2012, according to the Lehigh Valley Association of Realtors (LVAR).

Pending home sales increased 25.2 percent, rising to 700, from July 2012 to last month. Pending sales indicate a count of the properties on which offers have been accepted, but the transaction has not yet been closed.

The average sales price was recorded at $211,889, up 6.9 percent over the previous year.

The median sales price rose 7.5 percent to $185,450.

"Increases in average and median sales prices, closed sales and pending sales are indicators that there is a strong housing market recovery in the Lehigh Valley," said Ryan Conrad, CEO of LVAR.

Inventory was down 21.6 percent to 6.9 months. Inventory of approximately four to seven months is constitutes a balanced real estate market.

"Our research indicates that homes sold more quickly compared to last year at the same time as the number of days on the market decreased 6.8 percent to 68 days," said Therese Kelley, President of LVAR.

The National Association of Realtors is cautiously optimistic, predicting an overall 8 percent rise in existing home sales and an 11 percent rise in median sales price by year end in the United States.