BOSTON ( TheStreet) -- A week after the release of key housing indicators, the real estate market still doesn't have its house in order.

The Commerce Department announced a week ago that housing starts jumped 10.5% in August, and homebuilders including KB Home ( KBH), Lennar ( LEN), Pulte ( PHM) and D.R. Horton ( DHI) rejoiced, while their stocks rose. Three days later, the Commerce Department said new home sales were flat, with the 288,000 houses sold in August falling below estimates.

Toll Brothers' ( TOL) shares also advanced on the homebuilding news, but the sales reality was foreshadowed by Executive Chairman Robert F. Toll during the company's third-quarter earnings release in August. The company returned to profitability, earning 19 cents a share for the quarter, with cancellations down from 8.5% in third quarter of 2009 to 6.2% this year.

However, the company reported 19% fewer selling communities from the same period the year before and showed a $53.9 million net loss for the first nine months of 2010, with revenue down 14% and units sold down 8%. The foundation is strengthening, but there's a lot of rebuilding left to do.

"Although the unemployment rate among our buyer profile remains at half the national unemployment rate, recent economic and political news continues to dampen our customers' confidence," Toll told shareholders. "We believe the combination of potential buyers postponing their purchasing decisions, a lack of new home production over the past several years, and a significant reduction in our competition in the luxury home niche could result in pent-up demand coupled with limited supply once a recovery takes hold."

It's a similar story for existing home sales, which exceeded expectations with a 7.6% increase in August. That's up from a 15-year low in July, with unsold housing stock dropping 0.6% to 3.98 million units and median home prices rising to 0.8% to $178,000. The buyer base, though, has changed drastically since the first-time homebuyer tax credit expired.

"In the two months after the tax credit, there are more trade-up buyers and investors making cash purchases, but fewer first-time buyers," says Lawrence Yun, chief economist for the National Association of Realtors. "Some job creation and more affordability will draw more first-time homebuyers into the pipeline, but homebuying has never been a snap decision."

Estimating that new homebuyers will take at least two months to mull a purchase, Yun's equation for recovery adds those two months to the length of time necessary for job numbers to rebound. In the meantime, he says falling rates for "jumbo" loans of $700,000 or more brought an increase in luxury sales. Jumbo mortgage rates have dropped from more than 6% at the beginning of the year to 5.26% now, according to HSH Associates, which did wonders for the high-end real estate market when coupled with a 9.5% increase in the Dow since last September.

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