Housing prices generally will rise in each of the next four quarters, but by progressively slower rates on a year-over-year basis, and they will fall in progressively larger numbers of metropolitan statistical areas, according to Friedman, Billings, Ramsey & Co.FBR said it had re-estimated the econometric model it introduced in April to arrive at the new forecast. "The demand for housing should overcome the pressure from the higher mortgage rate in the majority of the 379 MSAs, allowing house prices to rise in the year ahead, albeit at slower rates than in the year past," said FBR analyst Michael D. Youngblood. The forecast calls for a general year-over-year house price increase of 7.1% in the second quarter, 5.7% in the third quarter, 4.4% in the fourth quarter, and 3.5% in the first quarter of 2007, FBR reported. Among the 100 largest MSAs, FBR is forecasting that house prices will fall year over year in the first quarter of 2007 by 7.1% in Honolulu; 2.5% in Little Rock, Ark.; 2.0% in St. Louis; 1.8% in Columbia, S.C.; 1.6% in Charleston, S.C.; and 0.9% in Pittsburgh. FBR can be found on the Web at http://www.fbr.com.

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