Builders Group Sees Pickup In Housing This Year

ALEX VEIGA

LOS ANGELES (AP) — The U.S. housing market will begin to mount a turnaround this year, building toward a solid recovery in 2013, according to a forecast issued Wednesday by the chief economist of a homebuilding industry trade group.

The outlook by National Association of Home Builders Chief Economist David Crowe calls for U.S. sales of new homes and single-family home construction to improve this year compared to 2011, when they hit record lows.

The forecast still leaves new home sales and construction well below the levels of a healthy housing market, however. That reflects the severity of the industry's downturn, and it suggests the housing market could be years away from full health.

"I'm looking at 2012 as sort of a ramping event to get a much more solid recovery in 2013," Crowe said in a telephone interview.

The economist, who presented his forecast at the trade association's annual conference in Orlando, Fla., sees sales of new, single-family homes climbing 19 percent this year to 360,000, up from 303,000 last year.

Next year, he expects those sales to rise by a whopping 40 percent to 505,000.

Even if the forecast proves true, that still leaves new home sales below the 700,000-a-year pace that economists say must be sold in a healthy economy.

Crowe's outlook also hinges on unemployment staying below 8.5 percent and the economy adding more jobs. And he's assuming that tight mortgage-lending requirements will ease this year, enabling more homebuyers to qualify for financing.

Freddie Mac Chief Economist Frank Nothaft, who also issued a housing outlook at the NAHB conference, said he expects total home sales to grow between 2 percent to 5 percent this year, thanks in part to still-low mortgage interest rates. He anticipates the average rate on a 30-year mortgage will remain below 5 percent this year.