Several months ago, we told our clients we thought we were entering a "W"-shaped recovery, with the "first leg up" in the W driven by four things:

  • tremendous affordability for those who are currently paying rent;
  • the $8,000 federal tax credit, which is currently set to expire on Nov. 30, 2009;
  • government-backed FHA, USDA, Freddie Mac and Fannie Mae lending programs that offer far more aggressive loans than a bank would make; and
  • positive media reports about rising median home prices, which are primarily driven by a location mix shift away from the poorer areas of town, but also driven by price stability at the lower end of the market.
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