Good year for housing

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single family home market, a rebound in the multifamily sector, and mortgage interest rates lingering at or below l%o,1994 will be a good year for housing.

Although 1993 was weaker than expected, housing starts and new home sales picked up during the second half. we expect that momentum to continue into 1994.

However, we don't expect any sEong surge in economic activity. Instead, the economy will move along at a growth rate of abott 2.57o annually for the next couple of years, just enough to gradually reduce the nation's unemployment rate. Poor consumer confidence is one factor holding growth back. hdeed, the job outlook is foremost on people's minds and, unfortunately,,highly publicized plant closings and co'rporate layoffs continue. This job picture makes people anxious about their own futures.

FornmaEly, continued low interest rates will help offset poor consumer confidence and support the economy's interest-sensitive sectors. Rates should stav at or below 7Vo on30-year fixed-rate mortgages thrcugh i994.

Low mortgage rates will continue to allow many people to move out of rental accomnodations and into their first homes. This trend is one factor that will fuel housing pro-