NAR Lowers Home Sales Forecast

The National Association of Realtors has lowered its forecast for home sales this year, citing the effects of stricter lending standards and a decline in subprime mortgage origination.The NAR, which was predicting 2007 existing-home sales of 6.42 million earlier this year, is now forecasting resales of 6.29 million. (Resales totaled 6.48 million in 2006.) NAR senior economist Lawrence Yun said new-home sales are now projected to reach a level of 864,000, down from the 1.06 million recorded last year. Housing starts are forecast to total 1.46 million, down from 1.80 million in 2006. "If it weren't for a favorable economic backdrop, housing would probably have a hard landing," Mr. Yun said. "As it is, we see this as a soft landing, with home sales rising gradually in the second half of the year and prices recovering a bit later." The association can be found on the Web at http://www.realtor.org.