This link to Kenneth Harney's Los Angeles Times article of October 16, 2006 will not last indefinitely, but it's well worth reading. Mortgage interest points have declined in recent months to 1 percentage point above 40-year lows; mortgage applications are up; unemployment is down; pending home sales are up as of NAR's October 2 report. The market is returning to 2003 levels, which was in itself a banner year for real estate sales.
All of which begs the question, "Just what kind of housing bust is this anyway? With gloom-and-doom purveyors forecasting imminent crashes in dozens of metropolitan areas, how could such key fundamentals as jobs, interest rates and even pending home sales simultaneously be trending in the opposite direction?" It's not a bust, it's a correction.
In a nutshell: "So, what's the source of some of the confusion about just where housing is headed? Mike Moran, chief economist of Wall Street's Daiwa Securities America, minces no words: The financial press and TV news shows are over-dramatizing what is a normal and long-predicted cyclical re-balancing, and 'portraying it as a catastrophe,' he said." With such eminent notables as the vice-chairman of the Federal Reserve, a managing director at JP Morgan Chase and the chief economist at Morgage Bankers Association all pointing out the "robust" economic indicators, buyers should certainly be taking note of the not-so-big market dip in prices.
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