Homes under contract for sale increasing

Pending home sales rise in December
The number of sales contracts signed increased by 6.3%, as buyers respond to fire sale prices driven by a record number of foreclosures.

By Les Christie, CNNMoney.com staff writer
Last Updated: February 3, 2009: 12:10 PM ET
NEW YORK (CNNMoney.com) -- Plunging home prices and low mortgage rates pushed homebuying activity higher in December, according to a regular industry report released on Tuesday.
The Pending Home Sales Index, from the National Association of Realtors, measures the number of sales contracts signed each month. It rose 6.3% in December to 87.7, after dropping 4% in November to a record low of 82.5.
The index was 2.1% higher than its December 2007 level...

Sales activity gained the most traction the South, where the index jumped 13% in December. The Midwest was also much higher at 12.8%. The Northeast, however, slipped by 1.7% and the index in the West fell 3.7%.
Home sales also benefited from a drop in mortgage interest rates during the month. The 30-year, fixed-rate loan averaged 5.29% for the month, with the average borrower paying a fee equal to 0.7% of the mortgage principal. That was, by far, the lowest that mortgage rates had been all year...
The lower mortgage rates helped push housing affordability to record levels.
NAR's Housing Affordability index improved to 158.8 in December, up more than 29% year-over-year. That makes buying a home more affordable than any time since NAR started tracking the measure in 1970.
A household earning the median U.S. family income can now afford a home of $277,000, according to NAR. That's well above the national median home price, which was $198,600 in 2008.