When you consider that consumer spending makes up 66 percent of the national economic activity -- that last figure is very significant.

These are the economic signs home sellers and buyers should look for to help time their purchase/sale so that they make as much return on their real estate investment as possible. In a similar fashion to purchasing stocks, you still want to buy a house low and sell it high. If you must purchase when prices are on the upswing, then you want to get into it with as little out of your pocket and with as cheap money as possible -- this means you are seeking a low interest rate.

The low interest rates have buoyed the U.S. housing market through the latest economic downturn. In addition, it appears new home sales are headed to another new record for 2003, according to NAR's Lereah. He added that 2004 should be the third best record in history. He made his comments at RISMEDIA's Leadership Conference in New York this week. RISMEDIA is part of the real estate media conglomerate that publishes the National Relocation and Real Estate Magazine, a widely distributed and read industry publication.

Lereah warned the assembly of nearly 1,000 real estate professionals that mounting deficits could hurt the real estate business after years of record-breaking sales.

"The biggest negative is the budget deficit," Lereah said. "That's the only thing that I can see right now that can hurt real estate."

He noted that the federal deficit has nearly hit $400 billion and could be $500 billion by the end of 2004. "That's on a road to $1 trillion ... That's not pretty," Lereah said.

Another line of statistics to look over is what happened to the interest rates the last time we came out of a recession. Visit Freddie Mac's 30-year mortgage historic statistics where you can watch the ebb and flow of rates as the economy eeks up and slips down. In the late 1990s and into the 2000s, when the Federal Reserve was afraid of an overheated economy, the rates jumped to more than 8.5 percent.

That type of increase can knock you out of the house of your dreams pretty quickly. As an example, a $200,000 mortgage at 6 percent (where the 30-year is lingering at present) the principal and interest payment would run $1199.10 versus $1537.83 -- that's nearly $4,065 more in payments per year for the same loan.

A few months ago when rates were consistently under 6 percent, a mortgage company president told me that more than half of all mortgages were undergoing refinancing. While that seemed like an amazing number, the thought that hit me was "What the heck are the rest of them waiting for?"

The rates are edging up, but they still remain under 6.5 percent at this writing. Side stepping the market to wait and see what will happen with interest rates next season may be to your disadvantage. As positive economic readings increase, more than likely, so will home mortgage interest rates. Frankly, real estate investing is more about financing than any other factor. Besides, if you get in now and rates drop, you can always refinance. If rates jump up, you can thank me later.