Historically (going all the way back to the Great Depression), housing recovers before unemployment has peaked.
Housing is a leading indicator of an economy recovering. In all previous recessions/depressions that had a housing component, housing has recovered before the economy has bottomed, and generally while unemployment was still trending down.
Unemployment is a trailing indicator. It hasn’t ever recovered until well after the economy is back to being solidly productive.
There are probably some good reasons for this: during a housing led recession, even though jobs may be being lost left and right, there will still be a large proportion of people with jobs that are safe – and who KNOW their jobs are safe (many classes of government employees, necessary service professionals like doctors, highly rated white collar professionals in large companies that are not in any danger of failing, etc). It’s a good time to bargain hunt for these people. In addition, the government tends to step up and subsidize stuff during these phases (for example, both now and in the 70’s housing recession, buying property produced an immediate tax break), which adds to the “bargain”.
Note: I don’t think the economy or housing has bottomed yet. I just think they’re close enough (especially housing) that it’s a reasonable proposition to buy now.
