Economists say housing market cooling, not crashing

More interest-rate hikes could temper optimism

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Housing sales and starts are down from last year’s peaks, and will continue to decline in 2007 and perhaps into 2008, economists at Fannie Mae, Freddie Mac and the National Association of Home Builders predicted today.

Although the housing market is slowing down with the economy, there are no signs of recession or a bursting bubble. A slowdown in the economy could cushion the decline in the housing market by bringing an end to a series of 17 quarter-point, short-term interest-rate hikes by the Federal Reserve, the economists said.