It’s time to pay close attention to homebuilders. While we have 12 weeks to wait for the Q1 2009 Case-Shiller Housing update the S&P does publish monthly housing data with a two month lag on the last Tuesday of the month. The recent data shows the third largest monthly fall in housing prices since the decline began in mid 2006. The index fell 4.16 in January, a close third to the previous highs of -4.28 and -4.72 set respectively in January and Februay 2008. Those figures are all more than twice the average of -2.00 since the housing decline began.

Homebuilders are selling below book and the US is in a recession. Is now the time to start buying? If we are anywhere near the bottom in housing then homebuilders are looking attractive.