The nation’s top builders give us one vantage, while our lawmakers give us another. No matter how they spin it, the real estate market is not bouncing back anytime soon.

The real estate industry is like a dog chasing its tail. Good news follows bad news in a never-ending cycle. The American consumer, like most dogs do when they finally give in, has laid down and refuses to move.

Until they have proof that the downward spiral is over, potential buyers are not signing any contracts, no matter how weak our legislators have made the timeless legal principle.

For proof of the industry’s malaise, we have two options. We can either look at the companies at the heart of the housing market or we could see what our elected officials are cooking. We’ll start with the private sector. There is more of a chance of actual facts.

Shares of Toll Brothers (NYSE:TOL) are jumping in value today after the company released its fiscal first-quarter results. While the figures would have caused wailing just two years ago, under current economic conditions they look better than most expected.

The company reported a loss of $89 million for the past three months. Bad, but not as bad as a year ago when that figure hit $96 million.

The reason for the difference? Fewer write-downs.

After writing down the value of its land and purchase options by over $245 million this time last year, the company only had to scratch out $156 million from its assets this quarter. Without the write-downs, the company would have made $9.6 million.

The most important statement in the company’s report today, however, was not a financial figure. It was the Toll Brother’s announcement that it has yet to make any new land purchases, but is getting closer.

That statement pretty much wraps up the dog chasing its tail analogy. Builders are waiting until prices stop falling, yet prices won’t stop falling until builders start to buy.

How much lower will prices have to go before buyers return to the market?

If President Obama’s plan works, Washington may be able to tie a parachute to the industry in freefall. But as anybody who has ever jumped out of a plane knows, no matter how big your parachute, you always fall to the ground. Sometimes it just takes a bit longer and hurts less.

Go ahead and jump

After a horrific debut, a speedy return to the drawing board and a tea-party inducing official unveiling, Obama’s foreclosure solution is finally available and open to all… or at least the folks paying mortgage payments of more than 38% of their monthly gross income.

Under his plan, the federal government and mortgage lenders will work in tandem to reduce a “troubled” homeowner’s mortgage payments to just 31% of their monthly pay.

That’s great. Combine the $200 that they will save each month with the $13 weekly pay increase Obama gave all of us middle-class workers and now they can afford that big-screen, high-def TV they have been wanting.

Problem solved.

Well, there are a few problems remaining, but only if you believe in contract law and a free market. If not, we are in the clear. The government is picking up the check for our sloppy habits.

The way I figure it, as long as the taxes come out of my paycheck before I ever get to see it, it is like money I never even had… right?

If only more people felt that way, Obama’s job would be so much easier.

But don’t worry, he is getting closer by the day. Soon, that dog will catch his tail.

Source: The housing market: Pennies where there was once dollars