Home sales contracts up in January

The number of Americans who signed contracts to buy homes rose last month to the highest level in nearly two years, supporting the view the housing market is gradually coming back.

The National Association of Realtors said Monday its index of sales agreements rose 2 percent last month to 97, the highest since April 2010, the last month buyers could qualify for a federal home-buying tax credit and the last time the reading was above 100. Above 100 is considered healthy.

The Realtors group also released revised data for 2011 that lowered November's initial 19-month high of 100.1 to 96.9. But contracts have been markedly up since the summer when some feared a second recession loomed.

Contract signings typically indicate where the market is headed. There's a one- to two-month lag between a signed contract and a completed deal.

One-third of Realtors complain they've had at least one contract scuttled in January, December, November and October, according to the association. That's up from 18 percent of Realtors in September.

Still, the gain in signed contracts supports other evidence of improvement in the housing market. Sales of previously occupied homes are at their highest level since May 2010. More first-time buyers are making purchases. And the supply of homes fell last month to its lowest point in nearly seven years, which could push home prices higher.