This week brings more bad news for builders, who are seeing another decline in housing starts.

The U.S. Commerce Department reports that starts have declined by 4.3 percent. This is the slowest pace since October 2009.

National Association of Home Builder's Chief Economist, David Crowe, notes that the report is consistent with what home builders have been telling us in our recent surveys. He says, While builders remain extremely cautious about new construction at this time, they are looking forward to putting their employees back to work as economic conditions improve over the new year - assuming they can obtain the necessary financing for new-home production.

Access to credit has been limited, and according to Crowe, Builders' access (especially small builders) to the credit they need to start new homes remains the fragile component.

The 4.3 percent decline in December housing starts was due to the 9.0 percent shortfall in single-family homes. Multi-family housing starts fared better, rising 17.9 percent. The multi-family market, however, has swayed precariously back and forth over the last year and is considered volatile.

According to the NAHB, Building permits, which can be an indicator of future building activity, rose 16.7 percent in December on gains in both the single- and multifamily sectors.

The labor market has also seen a slow start this year. Freddie Mac reports that while nonfarm payrolls rose by 103,000 in December -- this rate was weaker than analysts had expected. This sluggish pace does little help the ailing housing market. Most analysts tie a housing recovery with a jobs recovery.

Freddie is more optimistic, though, about the future, saying, Macroeconomic policies support future growth. The recent tax deal reduced payroll taxes by 2 percentage points for low- and middle-income workers. Together with the extension of earlier tax cuts, lower payroll deductions will bolster take-home pay in the months ahead, which is expected to support the upward trend in consumer spending.

According to the National Association of Home Builders (NAHB), This year's spring selling season will be better than last year's. This hope is riding on a recovering job market.

Frank Notehaft, Freddie Mac Chief Economist, feels that the housing recovery will start up slowly in 2011. Supporting this trend will be the low housing production states -- namely in the Plains -- as well as housing affordabililty and demographic trends.

Also helping this forward motion are the findings in a recent National Association of Realtors® (NAR) survey by Harris Interactive.

The study found that even through the recession, and now in the recovery, 95 percent of owners and 72 percent of renters believe that owning a home is a smart buy over the long-term.

But whether or not they enter the market, according to NAR, depends strongly on the job market, In today's market, many aspiring home owners are faced with worries about job security and creditworthiness. Among renters who are very or extremely likely to buy a home in the future, three out of five consider confidence in job security and creditworthiness to be an obstacle.