NAR: Home Sales Should Hold Firm

Meanwhile, the National Association of Realtors is predicting that home sales will remain at near-record levels in the short run and then decline to levels that are still strong by historical standards.In the association's May real estate outlook, NAR chief economist David Lereah says economic growth should stay above historical averages over the next two years and that this should sustain home sales in spite of higher interest rates. "With mortgage interest rates bottoming out in March, we've had a big rush of homebuyers this year," Mr. Lereah said. "Home sales should hold close to record territory for a couple of months, then ease in the second half of the year but remain at historically strong levels." The NAR economist said the 30-year fixed mortgage rate should rise slowly, reaching 6.6% by the fourth quarter. This is an upward revision since the NAR's March outlook, when the association was projecting a 6.3% rate for the fourth quarter. The NAR can be found on the Internet at http://realtor.org.