The cost of financing with a 30-year, fixed-rate mortgage is expected to reach 6.9% by this year’s fourth quarter, Lereah said, but “at the same time, unemployment should drop to 5.3%, so we continue to have a very favorable backdrop for housing.”
Job growth could reach 3 million this year, Lereah said.
“The economy is moving quickly now and the Fed is likely to raise short-term interest rates on June 30,” he said. “The market appears to have anticipated the move and has priced it into 30-year mortgage rates, but the cost of financing remains historically low and strong demand will push home sales to a record this year.”
Mark Your Calendar for NAHB's Fall Construction Forecast Conference
Get the latest forecasts on housing starts, project budgets and other economic bellwethers of the housing industry at NAHB's Fall Construction Forecast Conference at the National Housing Center in Washington, D.C. on Oct. 27. Click here for more information.