Today's Housing Figures
The reaction to today's release of the monthly S&P / Case-Shiller index of twenty metropolitan markets has been mixed.  I for one think the news is good.  The index, which was up .3%, showed that the housing market was improving without the Government's tax credit for first time homebuyers.  Yes, the credit is still available, but from what I have read, its impact on the most recent numbers is much less than last fall when buyers rushed to take advantage of the tax credit that was initially set to expire at the end of November.  California was a big beneficiary of the increases with some markets up 1% or more.  

Here is a quote from a naysayer in the LA Times:

"If you look at the last two big real estate bubbles in the late 80s and 70s, you didn't see the market rebound for five years," said Christopher Thornberg, principal of Beacon Economics. "It's amazing to me that people can look at a rebounding market after the largest bubble ever and possibly think this could be sustainable."

He is right of course, but the key is when the bubble peaked.  In California, and other areas like Las Vegas and Phoenix, the bubble peaked much earlier than other parts of the country.  The bubble's peak was not marked by by the subprime explosion in mid-2007, but when values stopped increasing, which lead to the prime and subprime borrowers not being able to continue their cycle of endless refinance.  I reckon that California peaked in the summer of 2005, not the summer of 2007, so we are approaching the magical fifth year.