Homeownership, housing market outlook good

WASHINGTON, Aug. 30 (UPI) -- Members of the Washington-based Homeownership Alliance said Monday the homeownership and the housing markets look rosy for the second half of 2004.

During a call sponsored by the Homeownership Alliance, economists said this year's mortgage and sales record-setting trend and the growing economy would push the housing market up in spite of higher interest rates.

Paul Merski, chief economist for Independent Community Bankers of America, said bankers report a steady business in loans for home construction and for home sales.

Dave Seiders, chief economist for the National Association of Home Builders, said although the apartment market is facing record-high rental vacancy rates, a strong condo market is providing good support to multifamily housing production.

Some economists were more guarded in their optimism. David Berson, chief economist for Fannie Mae, said some geographic areas are reporting affordability declines to lows not seen since the 1980s, but low mortgage rates and record mortgage application levels suggest home sales will remain at record levels for some time.

And Frank Nothaft, chief economist for Freddie Mac, said he expects home equity lending will increase as refinance activity decreases.