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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: nextrade! who wrote (6220)	10/24/2002 7:23:56 AM
From: nextrade!	Respond to of 306849

U.S. housing activity seen slowing Mortgage Bankers Association makes annual forecast An optimistic bunch! <G> msnbc.com CHICAGO, Oct. 23 — U.S. housing activity, an isolated area of strength in the slumping economy for the past two years, is likely to slow in 2003, the mortgage banking trade association forecast on Wednesday. MORTGAGE LENDING SHOULD EASE to $1.57 trillion as the economy recovers erratically but a rise in interest rates could price some buyers out of the housing market, the Mortgage Bankers Association of America said in its annual forecast. The level of lending is expected to be a record $2.42 trillion in 2002, the MBA said. Still, the MBA said it believes 2003 will produce the third biggest volume of mortgage lending on record, after all-time highs in 2002 and 2001. “Mortgage rates are poised to increase gradually as economic activity picks up next year. This will slow mortgage funding activity of the course of next year,” Doug Duncan, MBA chief economist, said in a statement prepared for delivery. Duncan said home prices will grow more moderately next year than in past years, but that will help increase the number of homes available for sale, which are at low levels. “On a broad market basis, the economic fundamentals indicate some decline in price appreciation, but in the absence of a sharp and sustained rate increase, outright price declines are unlikely,” he said. Demand from an influx of immigrants, coupled with tight inventories of homes available for sale due to strict U.S. building regulations, support a strong market for some time into the future, he added. Interest rates for the popular 30-year fixed rate mortgage have scraped lows not seen since the 1960s as the Federal Reserve has lowered interest rates to boost a flagging economy.