Sales of existing homes in December rose by 12.3% over November to a seasonally adjusted annualized rate of 5.28 million. That figure, though, still lagged December 2009 by 2.9%, according to estimates released on Thursday morning by the National Association of Realtors (NAR).

Existing single-family home sales increased in December over November by 11.8% to an annualized rate of 4.64 million, which is 2.5% under the rate in December 2009. Existing condo and co-op sales in December jumped by 16.4% over November to a rate of 640,000, a figure that was 5.2% below the December 2009 pace.

An NAR spokesman confirms that an estimated total of 4,908,000 existing homes were sold in 2010, down 4.8% from 2009 but statistically even with 2008. While last year’s sales total was the lowest NAR has recorded since 1997, the spokesman also points out that the median selling price of an existing home rose by 0.3% to $173,000, the first increase in four years.

Perhaps the best news for the country’s economy is NAR’s estimate that the inventory of unsold existing homes receded in December by 4.2% to 3.56 million units, which represented an 8.1-month supply, compared to a 9.5-month supply in November. However, investors accounted for a larger portion of sales: 20% in December versus 19% in November and 15% in December 2009. First-time buyers represented one-third of sales in December, a percentage point above November but significantly below the 43% of sales they accounted for in December 2009.

Lawrence Yun, NAR’s chief economist, observes a pattern over the second half of 2010 that is “clearly showing signs of recovery.” He also sees the housing market getting closer to “an adequate, sustainable level.” In December, the West showed the strongest annualized growth rate in existing home sales, at 16.7% over November. Sales increased by 13% in the Northeast, even as that region's annualized rate was still 5.4% below December 2009 estimates.

Home builders don’t seem to be buying wholeheartedly into this optimism just yet. As Builder Online has reported over the past few days, builder confidence, as tracked by NAHB and Wells Fargo, has been dismally low in January. The Census Bureau also reported that new-home starts continued to decline in December, down 8.2% from the same month a year ago. Some analysts found a silver lining in Census’s estimate that building permits jumped in December by 16.7% over the annualized rate in November. But it’s worth noting that the December permit rate—635,000—was still 6.8% below December 2009.

John Caulfield is senior editor for Builder magazine.