When you get reports of increases in both new housing starts and existing home and condo sales in a single week, that's got to say something positive about where real estate is headed.

Last week the US Commerce Department announced that new home starts, which have been lackluster for most of the housing downcycle -- rose in January to their highest level in half a year.

Total starts nationwide were up nearly three percent for the month, and rose in three out of four regions covered by the Commerce report. In the Northeast, new starts bounced upward by 10 percent.

In the West, they were up by 9 percent, in the South by one percent.

Only the Midwestern region saw a decline -- of 3.2 percent.

Meanwhile, the latest quarterly report on existing home and condo sales found total sales up by a stunning 14 percent in the final three months of last year compared with the third quarter.

Transactions were up in 48 states plus the District of Columbia for the quarter -- and they jumped by double digit percentages in 32 states.

Even prices were on the upswing: Of the 151 major housing markets tracked by the National Association of Realtors' survey, median prices were higher in 67 -- and up by double digits in 16 metro areas.

Lawrence Yun, chief economist for the National Association of Realtors, attributed the rise in sales and prices to the two popular federal housing tax credits now available to first-time and repeat purchasers, plus low mortgage rates.

On a regional basis, the biggest sales gains came in the Western states, where they were up 16 percent for the quarter and are 18 percent higher than the year before.

In the Midwest, sales were up by nearly 15 percent. In the South, 14 percent. And in the Northeast by 11 percent.

In a separate study, the national housing affordability index closed out 2009 just a fraction below its all time record high, meaning new and existing houses are now more affordable for a broader group of households than at just about any time in the past twenty years.

The index, which is jointly published by Wells Fargo and the National Association of Home Builders, found that fully 71 percent of American families can afford to buy the median priced home with a median household income of $64,000.

An important part of that affordability equation , of course, is the mortgage market, and rates remain close to multi-decade lows.

Last week's average 30 year fixed rate was 4.9 percent, according to the Mortgage Bankers Association, while 15 year rates averaged 4.3 percent.

Published: February 23, 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.