Housing Market to Remain Strong for 2006

According to the National Association of Realtors'® (NAR) monthly housing market report, home sales should generally level out and remain at historically high levels, making 2006 the third-strongest year on record.

David Lereah, NAR’s chief economist, says mortgage interest rates are trending up but will remain favorable. “Economic growth and job creation are providing a favorable backdrop for the housing market, but rising interest rates have an offsetting effect,” Lereah said. “Home sales will move up and down somewhat over the remainder of the year but stay at a high plateau, meaning this will be the third strongest year on record.” He expects the 30-year fixed-rate mortgage to rise to 6.9 percent by the end of the year.