Brian Bethune Housing Quotations

Mortgage purchase applications continue to track downwards, suggesting that most of the expected pop in housing sales in January was weather-related.

The overall momentum in construction remains solid. We expect this pattern to continue, with public and commercial construction taking the leadership baton in 2006 as housing starts ease back moderately.

The gradual cooling off of the housing market will be welcome news at the Federal Reserve.

This is in line with our expectation that demand for new housing would 'cool off' towards the end of 2005 and in early 2006 as higher short-term interest rates, driven by the Fed, would ultimately translate into higher long-term borrowing rates.

The warm weather in January will provide a temporary upward boost to housing construction, but activity is expected to taper off in February.

If housing and stock prices go down, people will respond by increasing the flow of savings. If they have to save more to meet retirement objectives, then they'll have to cut down on consumption.