Reuters is reporting that the housing market has peaked and is in a slowdown that could last “at least another year.”
Increasing interest rates have caused much of the slowdown, according to economists cited in the Reuters article, and according to the Mortgage Bankers Association, sales have been significantly slow in the first quarter of 2006.
Probably the most notable tidbit contained in the story, however, is the following quote from Frank Nothaft, chief economist at mortgage finance company Freddie Mac:
“I think that the housing market actually crested in the fall of 2005 and we’ve been in a gradual cool-down. I do think the moderation continues a bit more in 2007. Our forecast is for mortgage rates to rise just a little bit more. But again it will continue the gradual and orderly slowing in housing activity.”