In the most recent issue of Eye on the Economy, NAHB's chief economist, David Seiders commented on long-term housing market conditions.

According to Seiders, the trough of this cycle in housing production will be at an extremely low level, compared with our estimate of the longer-term potential for housing production in the U.S.

Thus, once off the bottom, the growth potential for the housing market will be tremendous, and we’re looking for strong expansion during the 2010-to-2012 period as we climb back to sustainable trend levels ― around 1.85 million housing starts.

The path back to trend figures to be relatively smooth, and the kind of boom-bust housing cycle we’ve experienced during the past six years certainly is not on the horizon.

That boom-bust pattern is traceable to financial market excesses that provoked a violent snap-back, and we hopefully will not see anything like that for a very long time — if ever.

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