TBMA: Strong Home Sales, Rising Rates in '04

The Bond Market Association is predicting strong home sales and rising mortgage interest rates in 2004.Members of TBMA's economic advisory committee expect that the 30-year mortgage rate will rise to 6.65% by year-end 2003 and that the rate on the 10-year Treasury note will be 5.10%. With strong economic growth averaging 4.2% next year, TBMA is forecasting that home sales will match the 2002 total, but fall short of this year's record-setting pace, which the association estimates could total 7.2 million by Dec. 31. "Though we would expect less of a boost from mortgage refinancing activity in the coming year, based on the panel's medium forecast, total home sales -- both new and existing -- are expected to top the 6.6 million-unit total of 2002," the TBMA forecast says. The association can be found online at http://www.bondmarkets.com.