If new applications to buy homes are any gauge, the U.S. housing market is warming up, and that's despite the fact that we're now into the traditionally quiet holiday season.

Applications for home purchase loans soared 42 percent last week on a non-seasonally-adjusted basis compared with the week before, according to the Mortgage Bankers Association.

That burst of activity may have been influenced in part by the long Thanksgiving week layoff. Or it could have been an early reaction to the extension of the $8,000 tax credit or the start-up of the new $6,500 credit.

Either way, it was an exceptional week for mortgage lenders.

But here's another possibility: With the economy gaining a little momentum, interest rates have begun edging up again.

Mortgage rates are still close to historic lows, 4.9 percent on average for 30-year fixed and 4.3 percent for 15 year fixed, but MBA chief economist Jay Brinkmann says they're likely to exceed 5.2 percent by this coming March.

So, maybe the rush to nail down financing by home buyers is a smart move … compared with paying half a point higher rates by early spring.

On other economic fronts, we're looking at a mixed bag of reports this week, though mainly positive:

Freddie Mac's found home prices nationwide up by about one point on average during the third quarter. That's on top of a two percent gain for the second quarter. Clear Capital, a real estate data company, also found prices up marginally - by 1.4 percent - during the month of November, though a few local markets came in with double digit gains.

But not all surveys agree on that. The well-regarded “IAS 360” index came in with a contrarian result. It found that overall prices in the U.S. were down slightly on average -- by about half a percent.

Since there's not a huge variation among the three reports, we can probably safely conclude that -- at the very worst -- prices have stabilized in most markets -- and at the very best, they're up a little.

There were also positive indications on lower delinquencies and foreclosures across the country. Realty Trac says foreclosure filings in November dropped by 8 percent - the fourth consecutive month of declines.

And Trans Union, the big credit bureau, forecasts three percent fewer mortgage delinquencies next year - after three straight years of rising delinquency rates.

Meanwhile, ZIP Realty's latest national study on price reductions on listed properties found that during November the number of price cuts dropped in 27 major markets, a welcome sign of more realistic asking prices.

Published: December 15, 2009

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Kenneth R. Harney writes an award-winning, nationally-syndicated column on housing and real estate from Washington, D.C. He is also managing director of the National Real Estate Development Center, a professional education company. He is a past member of the Federal Reserve Board's Consumer Advisory Council, a committee that by federal statute reviews all Fed actions on home mortgage, consumer credit and banking industry regulation. He served as a member of the U.S. Department of Housing and Urban Development's Working Group on Computerized Loan Origination (CLO) systems, and is a member of the Editorial Board of the Fannie Mae Foundation's journal, Housing Policy Debate. He is the author of two books on mortgage finance and real estate.