Pending home sales near a two year high in January

WASHINGTON (Reuters) – Signed contracts for home resales rose to a nearly two-year high in January, an industry group said on Monday, further evidence of a budding recovery in the housing market.

The National Association of Realtors said its Pending Home Sales Index, based on contracts signed in January, increased 2 percent to 97.0 – the highest reading since April 2010.

December’s reading was revised down to 95.1 from a previously reported 96.6.

Economists polled by Reuters had expected signed contracts, which lead existing home sales by a month or two, to rebound 1.0 percent after a previously reported 3.5 percent fall. Contracts signed were up 8.0 percent in the 12 months to January.

A nascent recovery is under way in the housing market, with the supply of both new and previously owned homes on the market being whittled down in recent months.

But with the foreclosure tide yet to recede and continuing to depress prices, recovery will be a long, drawn-out affair.