From RealTrends.com:
Index
Pending home sales are continuing an uptrend, with contract activity rising in five out the past six months. The index rose two percent in December but remains four percent below a year ago. However, the steady recovery suggests sales activity is very close to a sustainable, healthy volume, which would be in the range of five-and-a-half million sales.
Context
Modest gains in the job market and the improving economy are creating a more favorable backdrop for homebuyers, allowing them to take advantage of excellent housing affordability conditions. Mortgage interest rates should rise only modestly over the next few months, so we’ll continue to see a favorable environment for buyers with good credit.
Forecast
Buyers who were hoping for prices to fall moderately are likely to be disappointed in most areas…the national median existing-home price actually rose 0.3 percent in 2010, and a flat price trend is likely to continue this year, perhaps rising a half of a percentage point.
With very good affordability conditions, job creation and an improving economy, existing-home sales are projected to rise about eight percent this year to 5.3 million, which would be very close to what we consider to be a healthy, sustainable level (of about 5.5 million).