Housing analysts forecast summer warming trend
NEW YORK – Jan. 17, 2007 – Housing experts, speaking at a recent Real Estate Connect conference, said stabilization or improvement in mortgage rates, residential prices and household incomes will spark a rebound in the housing market by the middle of the year.
Freddie Mac chief economist Frank Nothaft forecasts “some pretty clear, consistent signs of recovery in home sales and single-family construction” by summer. Expectations that the Federal Reserve will hold interest rates steady or take steps to boost the economy by cutting rates are responsible for predictions of a housing rebound, with experts noting that a jump in interest rates or unemployment rates could worsen the downturn.
Housing economists also anticipate problems in the subprime niche, with some cash-strapped borrowers forced out of their homes as their monthly payments rise and become less affordable. This pattern could drive up inventory and exert downward pressure on prices.
Source: Investor’s Business Daily (01/12/07) P. A8
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