The Pending Home Sales Index rose 10.4 percent to 89.3 based on contracts signed in October, according to the National Association of Realtors (NAR).

The 10.4 percent increase was a record, according to Bloomberg, and was higher than many economists projected.

The index is still 20.5 percent below last October’s 112.4, which was the highest level since May 2006.

NAR chief economist Lawrence Yun said in a press release that good housing affordability conditions are drawing home buyers, but warned the housing market still has a long way to go to recover.

“Activity needs to improve further to reach healthy, sustainable levels,” he said. “The housing market clearly is in a recovery phase and will be uneven at times, but the improving job market and consequential boost to household formation will help the recovery process going into 2011.”

The index increase came after a 1.8 percent decrease in September.