Signs of a cyclical turnaround for housing are on the upswing. Sales are up sharply in many of the hardest-hit markets, and prices are firming in many others.

And now, even some of the country’s previously most-bearish economists and media outlets are seeing the light.

Last week, Dr. Mark Zandi, chief economist for Moody’s Economy.com, surprised analysts by announcing that “the bottom of the housing downturn is in sight for the nation.”

Just days later the Wall Street Journal — which had been among the most pessimistic of major U.S. dailies — ran a prominent article with this headline: “For some, it’s finally time to dive into the housing market.”

The article focused on purchasers in Phoenix, Seattle and Connecticut who recently found that lower prices and affordable mortgage rates made ownership possible for them. They got what appear to be great deals.

The Journal quoted one Phoenix buyer who had just picked up a bargain-priced first home as saying, “six months ago, I didn’t think I would ever own a home. Now I do. It’s so perfect.”

It’s obviously good news that doom and gloom economists like Zandi and the Wall Street Journal are picking up on what’s happening in local real estate markets. More important for the larger market, though, is that they are in the position to spread the word to consumers that it’s now not simply a “good time to buy,” it’s also a safe time to buy.

Mortgage rates continue to hover near historic lows. According to the Mortgage Bankers Association, thirty year fixed rates last week averaged 5.2 percent, down from 5.3 percent the week before. Fifteen year rates average a flat five percent.

But don’t mistake the message here: The economy as a whole still is facing huge problems — unemployment at 7.6 percent, banks taking billions from the government, a stock market that’s still pumping out losses, household consumption down.

None of that is positive for real estate.

But here’s what may be developing: Just as housing’s troubles preceded the rest of the economy on the way down, there are increasing indications that housing could be out ahead on the national economic recovery.

Why? Because pent-up demand is strong, affordable financing is there for buyers with decent credit and a downpayment, and improved federal tax credit incentives make the equation even better.

Once more consumers grasp the fact that the worst is over for real estate, we just might see some very encouraging numbers in the months ahead.

First time buyers will get an improved, higher, nonrepayable version of last year’s repayable $7,500 tax credit under Congress’s massive $789 billion economic stimulus package.

That in turn should lead to 500,000 additional home sales this year, according to new estimates prepared by the National Association of Realtors economics staff and provided to Realty Times.

With the credit eligibility period now extended to September 1, instead of the previous cut-off date of June 30, the 500,000 additional transactions will include purchases not only by direct users of the credit, but also replacement home purchases by sellers who are moving out …or moving up.

This year’s better tax credit should also generate huge amounts of “ripple effect” bang for the buck — $62,000 of additional economic activity for every house sold – or roughly $31 billion in incremental economic benefits, according to the Realtors’ projections.

Why? Because virtually every home purchase triggers other purchases and payments down the line — furnishings, appliances, remodeling, real estate commissions, moving expenses and the like.

Not everybody in Washington is happy with the new credit, however. The National Association of Home Builders pushed hard for a $15,000 credit for all purchases during 2009 — and got it inserted in the Senate version of the stimulus package.

But House and Senate conferees decided that was too costly in a bill that already had $280 billion in other tax benefits, and they cut it back to the smaller version passed earlier by the House.

Though the improved tax credit is drawing most of the attention, the stimulus package has a handful of other incentives and benefits for home owners. For example, it extends or expands all energy-related tax credits — for everything from energy efficient heating and airconditioning units, doors, windows and insulation – through the year 2010.

And the bill should produce a lot of additional economic activity aimed at “weatherization” of up to one million houses owned by moderate-income families — $5 billion worth of new subsidies, according to House Speaker Nancy Pelosi.

Still another big program in the package should create economic ripple effects in neighborhoods where there have been heavy numbers of foreclosures. The bill provides two billion dollars to buy up, renovate and either rent out or resell foreclosed and vacant houses.

The money will go to local governments, but the actual rehab, rental and resales work will flow to people in the private sector.

So if you live or work in an area that’s seen a lot of foreclosures, check in with your local housing and planning departments to see how you might fit in.

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Giffels-Webster Engineers (GWE), a civil engineering firm with a 50-year industry reputation for its vision for today’s market and beyond, revealed its annual list of Top Five Real Estate and Development Trends. According to GWE, the hottest market-growth areas are:

1. Infrastructure Rehabilitation
2. Urban Redevelopment
3. Energy Generation
4. Life Sciences
5. Healthcare Expansion/Renovation

Intrinsic to each of the following trends is sustainable design and LEED-certified construction. Green elements will continue to be incorporated into projects as energy efficient, healthy spaces remain a top priority.

Infrastructure Rehabilitation

There has long been a need for public investment in the nation’s aging infrastructure – roads, bridges and utilities. The new presidential administration has expressed a substantial commitment to this investment, which will generate significant work for public agencies, private design consultants and contractors.

Urban Redevelopment

Retail and residential re-development opportunities exist in urban areas, where the population and infrastructure foundation is already in place. This year, expect to see an increase in repurposing manufacturing plants and industrial buildings into new mixed-use developments. In addition, public investment to create connected, urban living spaces with walkable and bike-friendly communities are gaining popularity. Creating and improving light rail connections from cities to suburbs will also see investment.

Energy Generation

Government and private investment in energy generation, particularly of renewable sources, will provide opportunities for developers, construction managers and civil engineers as demand for clean energy grows. Many states, especially in the Midwest, are mandating that higher percentages of electricity come from renewable sources like wind energy, which will require site planning and manufacturing for thousands of new turbines.

Life Sciences

The life sciences industry is positioned for growth as a result of the aging baby-boomer population, increases in prescription drug spending and steady investment trends. Many companies are building or expanding research-and-development facilities, labs and office space for biotechnology, pharmaceuticals and diagnostics. It’s an opportunity to provide facilities that meet these companies’ needs now and can easily be scaled up for future expansion.

Healthcare Expansion/Renovation

Healthcare facilities must stay on top of technology developments and treatment needs to remain competitive; new advancements can quickly outdate existing facilities. An aging baby-boomer generation, coupled with a trend toward single-occupancy rooms, will drive many hospitals, nursing homes and hospice centers to undergo substantial renovations and expansions in 2009.

McLEAN, VA — Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 5.25 percent with an average 0.8 point for the week ending February 5, 2009, up from last week when it averaged 5.10 percent. Last year at this time, the 30-year FRM averaged 5.67 percent.

The 15-year FRM this week averaged 4.92 percent with an average 0.8 point, up from last week when it averaged 4.80 percent. A year ago at this time, the 15-year FRM averaged 5.15 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.26 percent this week, with an average 0.6 point, down slightly from last week when it averaged 5.27 percent. A year ago, the 5-year ARM averaged 5.21 percent.

One-year Treasury-indexed ARMs averaged 4.92 percent this week with an average 0.5 point, up from last week when it averaged 4.90 percent. At this time last year, the 1-year ARM averaged 5.03 percent.

“Interest rates for fixed-rate mortgages rose this week amid economic reports that were somewhat better than consensus forecasts had anticipated,” said Frank Nothaft, Freddie Mac vice president and chief economist. “The economy slowed by 3.8 percent in the fourth quarter of 2008, less than the market consensus, with inflationary pressures held at bay. Meanwhile, personal incomes fell by only half as much as some market forecasters predicted.

Low mortgage rates and falling house prices have made housing the most affordable in 19 years. The National Association of Realtor’s monthly affordability index rose to an all-time record high in December 2008 since records began in January 1971. As a result, pending existing home sales rose 6.3 percent in December 2008 and were up 2.1 percent from the previous December.”