Frank Nothaft, chief economist, Freddie Mac, agreed with Berson. "We are not at the trough yet," Nothaft said. Affordable housing sales are still declining. "Some markets are holding up well…because housing is local, local, local by nature," he said. The apartment rental market is "doing quite well…holding up over the last few years."

Seiders, Berson and Nothaft spoke as a panel moderated by Seiders. In a separate presentation, Edward Sullivan, chief economist, Portland Cement Association, said that although "the distress in housing markets is not shared evenly," he expects another down year for sales in 2007. "Despite recent news offering hope that the worst is over, declines in mortgage applications for home purchase suggest that the slump in residential construction may extend through this year."

Sullivan predicted "the ongoing correction in residential construction is not likely to end soon and will exert an overall drag on 2007 cement consumption." He said the housing weakness is not being felt nationally. "The conditions that are causing the decline in housing vary from region to region in degree and magnitude," he pointed out.

"The real threat to the economy in the year ahead is not job losses resulting from a mild construction contraction, but instead, payback from how many homeowners financed the boom," Sullivan explained. "The pressures of this phenomenon will build in the next two years" as "a large portion of these loans were scheduled for late 2006." He said even more are scheduled for 2007 and 2008. "To the extent that issues relating to past home financing leak through, consumer spending will be dictated by the strength of the job market and increases in mortgage rates, and hence reset."