Signs of recovery in the housing market and the national economy keep popping up - and are even beginning to surprise veteran analysts on Wall Street and elsewhere.

Though economists had expected the latest pending home sales index to be down - after all, February saw the worst weather in decades in large parts of the U.S. - the numbers actually took a big bounce.

The National Association of Realtors reported that pending sales jumped 8.2 percent for the month and were 17 percent higher than they were at the same time last year.

Contracts in the Northeast were up by 9 percent, the Midwest by 22 percent and in the South by 9 percent. Only the Western region came in negative - down by 5 percent. But even in the West, pending sales were 15 percent higher than they were the year before.

With the April 30 deadline for sales contracts to qualify for the two housing tax credits just weeks away, analysts expect home sales activity to remain high. Lawrence Yun, chief economist for the National Association of Realtors, says he thinks we may be in “the early stages of a second surge” of real estate transactions that could continue into mid-year.

But let's be clear: Home sales are not only being pushed by tax credits. Far stronger impetus is coming from steadily improving conditions in the national economy and rising consumer perceptions that finally things are getting better.

Look at the latest monthly employment numbers from the Bureau of Labor Statistics. For the first time in nearly two years, there was significant new job creation during the month of March - 162,000 payroll positions.

That was helped along in part by Census Bureau hiring to conduct the 2010 census, but there was growth elsewhere as well: 15,000 net new construction jobs, 17,000 manufacturing jobs, and 11,000 business services jobs.

Home Depot and other big household-oriented retailers announced that they have begun hiring again. Retails sales nationwide jumped by 23 percent for the month; home furnishings and furniture sales were up 14 percent

Mark Zandi, chief economist for Moody's Economy.com, told the New York Times that “consumers are (getting) almost giddy” in their zeal to resume spending, and they are cutting their savings to fund their new purchases.

All of this, of course, is great news for housing, which is hardwired to employment growth and consumer confidence

But don't assume we're out of the woods quite yet -- not with the national unemployment rate stuck at 9.7 percent. And there's another challenge taking shape on the horizon: Rising mortgage rates that are inevitable in an economy rebounding out of recession.

Published: April 12, 2010

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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.