Some housing bubble reports from Wall Street and Washington. "Home sales saw the biggest drop in 24 years last year, according to a trade group report on the battered real estate market. The National Association of Realtors reported that there was an 8.4 percent drop in the existing home sales in 2006, falling to 6.48 million from the record 7.08 million level in 2005."

"The annual sales pace in December was even slower- a 6.22 million annual rate, down 7.9 percent from a year earlier, and off 0.8 percent from the November sales pace. 'It looks like we're moving beyond the low for the housing cycle last fall, and buyers are responding to historically low interest rates and competitive pricing by home sellers,' said a statement from David Lereah, the Realtors' chief economist."

"Lereah said that in 2005, 40 percent of the market represented purchases of second homes and investors buying homes looking to resell them for quick profits. He said that speculators had now left the market and that should leave sales at a more sustainable level."

"'With fingers and toes crossed, it appears that we have hit bottom in the existing home market,' he said."

The Dallas News. "A day after the company reported its first-ever quarterly loss, officials with Dallas-based Centex Corp. said they expect to take more write-offs because of the soft homebuying market. The big homebuilder, which has already cut 17 percent of its staff, also plans more job cuts, Centex CEO Tim Eller said."

"He cautioned that the U.S. housing market still has potential for further decline. 'This housing correction is still unfolding,' Mr. Eller said. 'Although we are seeing some encouraging signs in some markets, it's still too early to call the bottom.'"

"For the quarter ended Dec. 31, Centex reported a $228.2 million loss. It took $435 million in charges to get out of lot purchases and write down the value of land. Centex expects $130 million in write-offs in the current quarter from canceled lot purchases."

"'We are estimating that we will walk away from another 40 percent of our remaining option deposits,' Mr. Eller said. Although the builder has dramatically cut back the number of vacant lots it owns, Centex still has a 3.5-year supply, which is 'longer than we would like,' Mr. Eller said. 'Most land sellers are not yet renegotiating options in a way we find acceptable.'"

From MarketWatch. "Centex said its home-building total gross margin for the latest quarter plunged to 6.7% from 29.2% in the year-ago period. CFO Cathy Smith said housing margin for Centex's latest quarter was 'down significantly' due mainly to an increase of discounts, which hit an all-time high of 8.3% of housing revenue in the quarter."

"'Our discounts will most likely remain at higher levels for a while as we stay aggressive in reducing our unsold homes and as cancellation rates remain high,' the CFO said. She said the company's cancellation rate was 38.5% in the quarter."

"Two large public home builders after the closing bell Wednesday said their quarterly profits fell from a year earlier as builders reel in their balance sheets to adjust to slower activity in the U.S. housing market. Ryland Group Inc. said its fourth-quarter net income dropped to $87.2 million, from $162 million in the year-ago period."

"The Company's consolidated net earnings decreased 46.2 percent for the fourth quarter. For the fourth quarter of 2006, new order dollars decreased 48.7 percent to $463.9 million from $904.2 million in the fourth quarter of 2005."

"Gross profit margins from home sales averaged 17.8 percent for the fourth quarter of 2006, compared to 26.3 percent for the same period in 2005. Total gross profit margins, including land sales, decreased to 17.9 percent in the fourth quarter of 2006 from 26.3 percent in the fourth quarter of 2005."

"This decrease was primarily due to pretax charges totaling $54.4 million, which were comprised of $42.8 million for inventory valuation adjustments and $11.6 million for write-offs of deposits and preacquisition costs, as well as to increased sales incentives relating to deliveries for the fourth quarter of 2006."

The Arizona Republic. "Meritage Homes Corp.'s earnings fell in its fourth quarter as it struggled with a housing slowdown that is hurting all the major home builders. The Scottsdale-based company earned $9 million in the quarter, down 91 percent from $101.9 million in the same period in 2005."

"Builders are finding they don't need all of the land they loaded up on during the frenzy. Meritage took $63 million in land charges in the quarter and $78 million for the year, either in inventory valuation impairments or forfeited deposits."

"Higher cancellations raised inventory. Meritage had 545 completed-but-unsold homes and another 820 that were unsold but under construction at the end of 2006, representing 32 percent of total inventory."

"'In response to slower market conditions, we are managing the business more conservatively by slowing new investments in land, renegotiating construction contracts on existing projects and aggressively managing overhead,' Meritage CEO Steve Hilton said."

From Reuters. "Gross margins fell 12.2 percent, less than half of the 24.6 percent last year. Orders fell to 1,201, nearly half of the 2,072 the prior year. The average order price was 16 percent lower than in the fourth quarter of 2005."

"Cancellations soared to 48 percent of orders, up from 32 percent in 2005. As a result of lower sales volume and selling prices, higher cancellations and increased closings in the last 12 months, the number of homes on order and waiting to be built fell 42 percent to 3,685, while the dollar value of the backlog shrank 45 percent to $1.2 billion."

"'Based on our reduced backlog and order trends in the last few quarters, we expect 2007 will be a difficult year,' CEO Hilton said in a statement."

"Beazer Homes USA Inc. reported Thursday a first-quarter loss and said it sees little proof pointing to 'meaningful' recovery in the nation's housing market. The company said it posted a loss of $59 million in the quarter ended Dec. 31, a reversal from the profit of $89.9 million generated in the first three months of fiscal 2006."

"The Atlanta-based home builder said $119.9 million in charges (were) taken for inventory impairments and abandoned land-option contracts. 'At this point, we have yet to see any meaningful evidence of a sustainable recovery in the housing market,' said Ian McCarthy, Beazer's CEO. 'Most markets across the country continue to experience lower levels of demand for new homes, high cancellation rates and significant levels of discounting,' the CEO added."

"The company's home closings totaled 2,660 in the latest quarter, down 31%. Orders for new houses plunged to 1,779 from 3,872 a year earlier, also on lower demand for homes. The company said its cancellation rate for the quarter rose to 43% from 26% a year earlier."

"NVR, Inc., one of the nation's largest homebuilding and mortgage banking companies, announced that net income decreased 39% when compared to the 2005 fourth quarter. The fourth quarter results were negatively impacted by land deposit impairments of approximately $60,000,000. These impairments lowered gross margins by 375 basis points."

From CNN Money. "Ford Motor Co. reported the largest annual loss in company history Thursday. The company has seen big drop in consumer demand for its key products, such as the F-series pickups. While still the nation's best-selling vehicle, the pickup saw sales plunge by more than 100,000 trucks in 2006 in the face of record fuel prices and a slump in the housing market, which cut demand from contractors."

"The number of homes in the United States foreclosed by lenders rose 42 percent in 2006 from a year earlier in a sign that many homeowners have became overextended in mortgage debt, a real estate information service reported on Thursday."

"Recent homeowners who believed the housing market would continue its break-neck pace or used flexible mortgages to make a purchase may be feeling a sting, the company said.As much as $1.5 trillion in adjustable-rate mortgages are due to have their rates reset this year, according to the Mortgage Bankers Association."

"Many recent homeowners are already struggling to make those higher payments and are drifting toward loan default and foreclosure, said James Saccacio, CEO of RealtyTrac."

"'As more and more of these loans re-set, we saw a surge to finish the year, with the fourth quarter producing more foreclosure filings than any of the three previous quarters,' Saccacio said."