According to the NAR and their March existing home sales report, home value declines eased but there remains continued downward pressure on home values due to the supply and demand imbalance.
Here is what the year over year percentage change in the median home value has looked like over the past several months according to the NAR:
Jun 2008: -6.1%
Jul 2008: -7.1%
Aug 2008: -9.5%
Sep 2008: -9.0%
Oct 2008: -11.3%
Nov 2008: -13.2%
Dec 2008: -15.3%
Jan 2009: -14.8%
Feb 2009: -15.5%
Mar 2009: -12.4%
A lot of economists, including Ben Bernanke, have been predicting that the housing market is nearing a bottom. But there seems to be not only a disconnect in what a "bottom" in the housing market actually is defined as, but also about the forces that will likely prolong the current housing depression.
In terms of the definition of a housing bottom, to me, it would be the point in time where prices have stopped falling as a result of the supply and demand for real estate coming back to healthy levels. The supply and demand for real estate is measured in terms of the month's supply of housing. In March of 2009, the month's supply of housing stood at a 9.8 month supply, just a 2% improvement from last March. This hardly points to a meaningful bottom.
Additionally, the variables that seem to be overlooked when discussing a housing bottom are the fact that we are in an environment of rising unemployment, we have had the recent luxury of foreclosure moratoriums, mortgage delinquency rates are rising, there are an estimated 700,000 homes of "shadow inventory" that the banks are sitting on, and there is still a very weak appetite in terms of the demand for real estate. At the risk of sounding like James J. Davis, the Secretary of Labor, in June 1930 when he said, "The worst is over without a doubt", I think the talking heads need to be a little more cautious with their predictions.