Getting a good read on housing has been complicated in recent months by the lingering effects of the home buyer tax credit and its expiration. The tax credit pulled sales forward as buyers sought to qualify for the credit before the deadline for signing a sales contract at the end of April, leaving the pool of prospective home buyers severely depleted.

Now there is early evidence that market demand is in the process of being restored by historically low mortgage rates and affordable house prices.

New home sales peaked in April at a seasonally adjusted annual rate of 422,000, their highest level since September 2008. In May, they fell precipitously to 267,000, their lowest level since the Census Bureau started reporting these figures in 1963. Part of the reason for such a decline could be attributed to the expiration of the home buyer tax credit.

Sales in June rebounded to 330,000, an indication that buyers are returning to the market. Although this was a healthy increase, it still left sales at the second lowest level ever recorded. NAHB is forecasting further improvement in coming months as mortgage rates remain low, house prices level out and job growth continues.

These declines represent the expected adjustment to the expiration of the home buyer tax credit. As we move beyond the tax credit, the true picture of the underlying market will begin to emerge by July or August. ?EUR??,,????'??? Courtesy of NAHB