Check out the latest from the respected Economists of the National Association of Home Builders. Click the link at the end of the paragraph for a detailed report.

Recessionary Forces Are Weakening at Home and Abroad
U.S. economic output contracted at a rapid pace late last year and early this year as the economy was rocked by a major financial market crisis that engulfed most of the world. Real gross domestic product (GDP) in this country fell at an average annual rate of 6% during the final quarter of 2008 and the initial quarter of this year, the sharpest two-quarter reversal in more than 50 years, and global GDP fell deeply into the red as well. (more)

Labor Market Contraction Still Has Some Distance to Run
Payroll employment in the U.S. has been falling continuously since the end of 2007 and the losses have been quite large since last fall – averaging 573,000 from October through May of this year. (more)

Inflationary Forces Should Be Benign for Some Time
The projected economic recovery should not generate serious inflation issues for quite a while. (more)

The Fed Will Not Stand Down Until Recovery Is Assured
The Federal Reserve has been a dominant force in the battle against financial chaos and the threat of depression, and Chairman Ben Bernanke has repeatedly assured the markets that the central bank “will not stand down” until these battles have been won. (more)

The Healing Process Is Underway in Financial Markets
Bernanke has stressed that normal functioning of financial markets is an essential precondition for sustainable economic recovery. The broad range of efforts by the Fed, combined with the financial stabilization policies enacted by Congress and the Bush and Obama Administrations, now are bearing a lot of fruit – reducing obstacles to near-term economic stabilization and recovery. (more)

The Demand for Homes Is Firming Up
The affordability of home buying has soared as house prices have fallen in many places and mortgage rates have held in a historically favorable range. Consumers’ views of home buying conditions have strengthened in the process – according to measures produced by the University of Michigan. (more)

Housing Production Should Stabilize Soon
The housing market still is saddled with large numbers of vacant units, both for-sale and for-rent, and the foreclosure wave obviously is adding to the inventory problem facing home builders. But starts of new units recently hit record lows, particularly the for-sale components of the single-family and multifamily sectors, and the recent firming of home-buyer demand should lead to some improvement in the pace of starts. (more)

Check out the latest from the respected Economists of the National Association of Home Builders. Click the link at the end of the paragraph for a detailed report.

The Pace of Economic Contraction Is Slowing

The sharpest contraction in economic activity during the current recession occurred in the final quarter of last year when a massive financial shock threatened to wreck the U.S. and global economies. Real gross domestic product contracted at a 6.3% annual rate in that quarter as spending declined sharply for all sectors other than the federal government. (more)

Consumers Are Expecting Somewhat Better Economic Times

Major measures of consumer confidence and sentiment recently have been regaining some of the ground lost during earlier stages of this economic recession. The recent gains primarily reflect brighter expectations regarding economic conditions down the line rather than more upbeat assessments of current economic conditions. (more)

Housing Affordability Measures Continue to Improve

The affordability of home buying continued to improve through April, as declines in house prices and mortgage interest rates more than offset the effect of eroding median family income. The standard measures do not capture the effects of changes in mortgage lending standards or price expectations harbored by prospective home buyers, but the recent improvements are essential to a meaningful turnaround in home buying activity before long. (more)

Consumers’ Views of Home Buying Conditions Continue to Strengthen

The Reuters/University of Michigan survey of consumer sentiment revealed that 80% of consumers had a favorable view of home buying conditions in May, up from 72% in April and the highest reading since early 2004. (more)

House Price Depreciation May Be Easing Off

All measures of national average house prices have shown stunning declines from the unsustainable highs of 2006 to 2007. These declines have taken a heavy toll on household wealth, as well as on the quality of mortgage credit and the strength of financial institutions while restoring the affordability of home buying to a large degree. (more)

Home Sales Apparently Have Bottomed Out

The cyclical trough for home sales (seasonally adjusted) apparently was reached early this year, and a gradual recovery may very well be under way at this time. Sales of new homes (Commerce Department series) fell by 76% from the cyclical high in July 2005 to the apparent low in January of this year, but sales volume was up by 7% as of April. (more)

Backup in Long-Term Rates Will Not Prevent Housing Recovery

Long-term Treasury rates have moved up considerably from their recent lows in mid-May, even though the Fed is holding the federal funds rate near zero and committing to maintain that policy stance for an extended period. Long-term fixed-rate mortgage yields have been subject to some upward pressure in the process, moving above 5% for the first time since March. (more)