Is Housing Raising Questions About The Recovery?

While the overall economy continues to show fitful signs of recovery, one of the biggest components of the overall economy, the housing market, is displaying definite signs of weakness.Stocks in the Homebuilding sector are under heavy pressure Thursday morning following concerning quarterly results from one of the large players in the space, Ryland (NYSE: RYL). Also likely continuing to impact trader sentiment in the space, the Street seems to still be digesting pending home sales data on Monday and a look into the S&P/CaseShiller Index on Wednesday.Last Monday's National Association of Realtors report showed pending home sales weakening 1.15 percent, with expectations of a rise of .3 percent. This followed last Thursday's disappointing new home sales number, which had the largest drop in over a year, decreasing 8.1%. This morning's lackluster earnings report from Ryland Group Inc. served as a further confirmation of the weakness in the housing market., with RYL missing on both the top and bottom line. RYL shares are down nearly 8 percent at the open,trading at 31.63, at levels not seen since 2012. This followed a disappointing report from DR Horton inc.(NYSE: DHI) on Monday.Other housing stocks are also lower this morning, with DR Horton (NYSE: DHI), Pulte Homes (NYSE: PHM) and Toll Brothers (NYSE: TOL) all down over 1 percent. Although the S&P 500 is up nearly 6 percent this year, the S&P Homebuilder ETF (NYSE: XHB) is down nearly 10 percent year-to-date at 30.02, and approaching a critical support level at 30. With housing stocks already showing signs of weakness, and heading lower, this will inevitably raise questions about the strength of the overall economic recovery in general.