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"I'm calling a housing bottom tonight," an exuberant Jim Cramer told the viewers of his "Mad Money" TV show Tuesday.
Cramer's call comes 14 days ahead of his original prediction, which called for a bottom in the housing market by June 30. However, after today's housing start numbers showed strength even in the nation's hardest hit areas, he amended his original call that was made back in August 2008.
Cramer said the latest reports showing a rise in housing starts and permits were too large to ignore. He said it proves the glut of excess inventory is finally behind us and home builders feel they can safely get rid of the land they've been sitting on by building homes.
Cramer said his housing bottom is not a call to buy the homebuilders, but rather a signal that home price depreciation has largely ended. He said that home prices will not be rising just yet, but they also will not be falling any longer.
Cramer said his bottom call also disproves the theory that interest rates have moved too far to promote home ownership.
Cramer said the stocks to own during a housing bottom are banks like
(WFC - Get Report)
(JPM - Get Report)
Bank Of America
(BAC - Get Report)
, all of which he owns for his charitable trust,
Action Alerts PLUS
and all of which have large mortgage exposure.
Cramer said new home formation, low interest rates, tax incentives and excess inventory have all made this bottom possible, and now is the time to step up and take notice.