UCLA’s Anderson Forecast predicted at its December economic outlook conference that U.S. housing sales would fall next year, costing the nation as many as 800,000 jobs. The study pointed out that new housing construction in October was down 5.6 per cent from the previous month.

This new study comes out at a time when the Wall St. Journal is reporting that investors are retreating from the speculative housing market. Previously hot markets in California, Florida, Las Vegas, Phoenix, and Washington, DC are cooling off, according to the Journal article. The Dallas market has been relatively stable from a pricing standpoint during the housing boom, except in certain select neighborhoods such as the Park Cities, Lakewood, the M streets, and North Dallas.

Are these the early warning signs that the housing bubble is finally about to burst? If so, that is not good news for the U.S. economy in 2006.

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