new home sales fall to historical lows

If one were to look at the graph that is here, one might extrapolate from the information that the trend line that began in 1992 and ran through 2006 was an 'abhoration' - its speed increased dramatically from prior periods.
New home sales went 'atmospheric' during that time frame.
Gee, I wonder what was the 'stimulus' behind this amazing anomaly?
The question today is how long will it take new home sales to recover from the 'irrationally exuberant' pace that took place in the late 90's and ran through the first half of this decade?

prb

Subject: May 2010 new home sales fall to historical lows
Date: Wed, 23 Jun 2010
From: "Stone & Youngberg Portfolio Strategy Group"

* Earlier today (6/23) the Census Bureau reported a dramatic -32.7% drop in new home sales for May. The (seasonally adjusted, annualized) number of new homes sold during the month was a depressing 300,000; the lowest number of monthly sales since the Census Bureau began tracking new home sales in 1963.

* The actual, non annualized, non seasonally adjusted, number of new homes sold in the US during May was an infinitesimal 28,000. (There are roughly 130 million housing units in the US.)

* Today's data clearly indicates that the housing sector is mired in a very deep recession. Unfortunately, historically low mortgage rates and new tax incentives are not sufficient to engender a recovery.

* The chart below suggests that in previous recessions, housing/construction was a big contributor to leading the US economy out of recessions. New home sales generally bottom out just before the start of a recession and start to rise during the recession - obviously that is not the case today.