Today, the National Association of Realtors reported that pending home sales rose 6.3 percent in December compared to the prior month. The South and Midwest showed the strongest gains. The number of pending home sales were up 2.1 percent from December 2007.

Lawrence Yun, chief economist of the Realtors' group, commented, The monthly gain in pending home sales, spurred by buyers responding to lower home prices and mortgage interest rates, more than offset an index decline in the previous month. The biggest gains were in areas with the biggest improvements in affordability.

This was the second positive sign in the past two weeks that the troubled U.S. housing market may be forming a bottom; at least for home sales. Analysts, however, have cautioned that prices will most likely continue falling throughout this year, and say that the outlook for home sales is highly uncertain, especially as layoffs mount.