A sure sign of a recession is the abandoned building site. But any financial analyst who strolls from Wall Street into Battery Park City, the strip of land running round the southern tip of Manhattan island, will be comforted by the construction work going on at several lots.

On one of these beside my office, a 28-storey riverside tower is just being finished and tenants are moving in. Leasing and buying has been steady since renting began weeks ago, according to the owners, Rockrose Development, and more than 140 of the 324 apartments have already been taken. Work is just starting on another two apartment blocks nearby.

Despite the economic downturn, the property market in the United States is still bubbling along. All across the country new houses and apartment blocks are being put up despite the economic slowdown.

Alan Greenspan might not have been able to save the Nasdaq with his 1.5 per cent cut in inter-bank rates over the last 10 weeks, but he has helped stimulate home sales by lowering the rates to which mortgage loans are pegged. Mortgage rates are in fact influenced less by the Fed than by investors in long-term bonds. They factored in the latest rate cut weeks ago.

The US economy has never fallen into recession as long as housing remained strong. Housing starts are up 8 per cent from last summer. The number of new, single-family homes sold in February fell 2.4 per cent but the sector remains vibrant.

Money to buy or build a new home is easy to come by in America. Falling mortgage rates along with lower lending fees and transaction costs have fuelled a huge movement towards refinancing, according to the Washington-Based Mortgage Bankers Association.

In the last three months of 2000, refinancing constituted a quarter of all mortgage activity in the US. In the first three months of this year it is expected to make up half.

Refinancing is something of an American habit. "People do it all the time," said Chris Hewitt, a professor at Maryland University who re-mortgaged his Glen Echo home three years ago when the interest rate was last down around 7 per cent. "Most of my friends have re-financed. The rule of thumb is that it make sense if the rate drops by 2 per cent."

The average US rate on 30year mortgages has fallen from a high of 8.8 per cent in May last year to below 7 per cent. This is enough for most home owners, who typically have no savings, are "maxed out" on their credit cards and need every break they can get.

A good example is the person with a 30-year mortgage who owes $299,000 (€334,676) and is making monthly payments of $2,700 at an interest rate of 8.8 per cent. After refinancing at 7.3 per cent, the monthly payments will come down to $2,050.

The surge in refinancing also comes from people who bought homes just a year ago and find that the value of their property has risen sharply, creating home equity that they may tap. Borrowers can get 80 per cent of the home's current value, pay off the old mortgage and get a new one at the lower rate.

All this cash saved by American households is giving a much-needed boost to consumer spending, economists say. It helps explain the gravity-defying sales of new cars. More than 1.36 million new cars and light trucks were driven out of American showrooms last month, the second-highest February sales in a decade and the most in any month since September.

So all is not doom and gloom. People are still spending money on "big ticket" items like houses and cars. Main Street USA is more upbeat than Wall Street.

For one homestead that is to be erected on a valuable piece of real estate in Battery Park City, financing is not a problem. Nor will it ever be lived in. It will not even have a roof and will only have a half-door.

It is a tumble-down 19th century cottage from the west of Ireland which will be shipped across the Atlantic in the coming months and re-erected, stone by stone, on a half-acre lot between the Merrill Lynch offices and the Hudson River, literally in the shadow of the World Trade Centre.

The site will be transformed into an Irish field, with old potato drills sprouting dandelions and thistles and bordered by dry-stone walls. When completed by St Patrick's Day next year, it will become the city's Irish Famine memorial. The $4.7 million bill, to be picked up by Battery Park City, makes the cottage the most expensive, if not the most desirable piece of property per square foot in the whole financial district.