Click on graph for larger image.An optimist might argue that we should already be in a recession based on previous housing slumps - so if the worst is over for this housing slump, a soft landing is very possible. Of course I think starts will fall further - perhaps to the 1.1 million SAAR level.
The WSJ housing story led with this sentence:
Home construction unexpectedly rose during April, making a surprise increase despite bloated inventories and tighter credit for subprime borrowers ...And yes, fundamentals like "bloated inventories" and less demand, do matter.