Despite a lot of sobering economic news for housing and real estate, there are some definite positives taking shape out there.

Pooh-pooh them -- or ignore them -- at your own peril.

First, the powerful combination of fixed 30-year mortgage rates in the mid-5's and house prices rolled back to 2003 and 2004 levels in some areas HAS to begin attracting the attention of consumers. That could happen as early as this Spring in some local markets -- or later in the year, but the buying opportunities are undeniable.

Second, despite all the grim and gloomy predictions about recession, the U.S. economy is still growing. No question that rate of growth slowed dramatically in the most recent quarter, but the fact is: The U.S economy is NOT in recession, thanks to a couple of key factors:

Total employment gains during the past 12 months exceeded one million new jobs. That measure went negative in the latest month by 17,000 jobs, but the month before job creation was UP by 82,000.

Exports-which jumped by an extraordinary 7.7 percent in the past 12 months -- are fueling some of that employment vigor.

Real after-tax household income rose last year by 1.1 percent. That may not sound like much, but in a giant economy such the United States -it's good news. In a recession, that number would have been negative.

Now to the housing market's prospects: Within the next 10 days to two weeks, the President is expected to sign legislation raising mortgage limits for the three most consumer-friendly financing programs - Fannie Mae, Freddie Mac and FHA.

Home buyers in high-cost markets will gain access to much lower-cost financing compared with the deal-killing "jumbo" rates they'd otherwise have to pay.

How big a difference could that make?

Compare payments on a jumbo loan at current rates of 7 to 7.5 percent to the 5.75 to 6.0 rates they'd potentially pay after the legislation takes effect.

Estimates vary as to how many sales and purchases this change will stimulate, but an independent economist on contract with the National Association of Realtors puts it at close to 348,000 additional home sales in the coming 12 months.

Bottom line here: It's not all gloomy out there. There are some hints of a pick-up on the horizon -- provided you're open to seeing them.

Published: February 7, 2008

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Kenneth R. Harney writes an award-winning, nationally-syndicated column on housing and real estate from Washington, D.C. He is also managing director of the National Real Estate Development Center, a professional education company. He is a past member of the Federal Reserve Board's Consumer Advisory Council, a committee that by federal statute reviews all Fed actions on home mortgage, consmer credit and banking industry regulation. He served as a member of the U.S. Department of Housing and Urban Development's Working Group on Computerized Loan Origination (CLO) systems, and is a member of the Editorial Board of the Fannie Mae Foundation's journal, Housing Policy Debate. He is the author of two books on mortgage finance and real estate.