The National Association of Realtors (NAR) has suffered some ridicule for its perpetually sunny housing forecasts, even while some markets have been drenched in bad news. But the outlook for 2008 is optimistic for several good reasons.

Lawrence Yun, NAR's chief economist, says the worst part of the credit crunch is over.

"The unusual mortgage disruptions that peaked in August were clearly seen in lower home sales that were finalized in September and October, so the market was underperforming," he said. "Now that mortgage conditions have improved, some postponed activity should turn up in existing-home sales over the next couple of months, and I expect sales at fairly stable to slightly higher levels."

NAR's recent Pending Home Sales Index was up slightly -- with two months of consecutive gains in homes under contract, but that's still nearly 25 percent below a year ago.

Lows are as unsustainable as highs in real estate, and many communities have been low for a long time. Yun is particularly encouraged by a pick up of pending sales in the depressed Northeast.

Prices are also on the increase in nearly two-thirds of U.S. metro areas, and not just in certain areas of the Sunbelt. Prices are up in Gary, Indiana, Binghamton, New York, and Spokane, Washington, as well as Corpus Christi, Texas.

"We can't emphasis enough how much local conditions vary, even within a given area, so it's important for consumers to make decisions based on local market conditions," says Yun.

Two factors that may impact housing in many areas are not so positive -- jobs and interest rates. NAR expects jobless claims to rise to 5 percent next year, up from 4.5 percent. Mortgage interest rates will go back to 6.5 percent, but let's remember that is still near historical lows. Inflation will rise, but only slightly and will remain under 3 percent.

So, the housing recovery will be gradual. Existing home sales for 2008 will be under 1 million.

Published: December 12, 2007

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Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. For more articles by Blanche, click here.