AP

For those hoping to see the same bump up in sales and prices that the first "first-time home buyer tax credit" produced last fall, the signs are already disappointing.

It's very hard to judge today's market, given how so many of the surveys and "indicators" are so far backward looking.

Today we saw a disappointing price report from researchers at S&P/Case-Shiller. This report shows home prices in March and quarter to quarter. The results were negative, and largely unexpected.

"If we put it simple terms and draw it on a picture, we can get worried about double dips," says S&P's David Blitzer. He also notes that the housing crisis has now shifted to a recessionary phenomenon, and not a housing boom and bust. We could argue round and round about the chicken and the egg, but the fact is that housing caused the recession and now the recession is causing trouble in housing. There is just as much trouble in prime loans as subprime; in fact there is more.

We saw sales of existing homes bump up in April, but that's based on closings, so those were contracts signed in February and March. A new report, the Campbell/Inside Mortgage Finance Monthly Survey of Real Estate Market Conditions, finds, "First-time homebuyers started to desert the housing market in April, ahead of expectations."

“We were surprised to see the early decline in first-time homebuyer participation,” commented Thomas Popik, research director for Campbell Surveys.

“When the tax credit was expected to expire last November, we saw a peak of first-time homebuyers in October. Now the first-time homebuyer peak appears to have occurred not one month, but two months early.”

Tomorrow we will get the Commerce Department's report on sales of new construction in April.

This report is based on contracts signed, not closings, so it will be the first of the last data on the effects of the tax credit. Most are expecting to see a big bump up.

But what next?

"We pulled forward a tremendous amount of demand this year, and we are starting to pay the price for it here in May," says Buck Horne of Raymond James. "We have already seen a 35 percent drop in purchase applications in the past two weeks, permits were down 11 percent in April, and we have seen spot lumber prices drop 25 percent since the end of April."

Questions?  Comments?