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The big news from this morning was Federal Reserve Chairman Ben Bernanke‘s hearing. Before the Joint Economic Committee this morning, he testified that recovery is on the horizon, likely starting late this year. Here’s what Bernanke had to say about the housing market, according to a transcript posted online.

The housing market, which has been in decline for three years, has also shown some signs of bottoming. Sales of existing homes have been fairly stable since late last year, and sales of new homes have firmed a bit recently, though both remain at depressed levels. Although some of the boost to sales in the market for existing homes is likely coming from foreclosure related transactions, the increased affordability of homes appears to be contributing more broadly to the steadying in the demand for housing. In particular, the average interest rate on conforming 30-year fixed-rate mortgages has dropped almost 1-3/4 percentage points since August, to about 4.8 percent. With sales of new homes up a bit and starts of single-family homes little changed from January through March, builders are seeing the backlog of unsold new homes decline—a precondition for any recovery in homebuilding.