New Housing Nearing Bottom, Says NAHB Economist

"The bulk of the housing contraction is now behind us," he said.

Seiders expects the Fed to lower interest rates at its March 18 meeting by another half point.

While the new economic stimulus package will be felt beginning in the third quarter, the nation's economy will only grow 2 percent for the year, said Frank Nothaft, Freddie Mac chief economist.

"That's not good," he said. "The economy must grow at 3 percent just to keep pace with the growth of the labor force."

Nothaft said the building industry must clear the "overhang" in unsold inventory of homes before home prices will pick up. He said the people in the best buying position today are prime borrowers with down payments who qualify for conforming loans.

David Berson, chief economist for the PMI Group, believes the economy went into recession in December but that it will be brief and mild.

While home prices will continue to fall in 2008 and 2009, he said that won't happen in Texas and the Carolinas.

He said the number of would-be buyers showing interest in buying a home is once again on the rise.