One of housing's sharpest economic forecasters says the market has been speaking to us with mixed messages so far this year.

Dr. Frank Nothaft, chief economist for giant mortgage investor Freddie Mac, sees low interest rates as a crucial, ongoing plus factor for real estate. Average national rates on 30-year, 15-year and 5-year hybrid adjustable loans all dropped in the latest survey. Rates are now even lower than they were the same time a year ago.

Thirty year fixed rate loans average less than 6.1 percent with half a point, 15 year loans are at 5.7 percent and 5-year hybrids at 5.8 percent.

Rates could go even lower if the Federal Reserve -- as is widely expected -- cuts short-term rates by another half a point later on this month.

Also on the plus side: Consumer confidence rose in the latest monthly Conference Board survey for the first time in nearly half a year, and consumers say they've got positive expectations for the next six months.

Now to the mixed message: The sudden sharp jump in the national unemployment rate to 5 percent from 4.7 percent was a shocker. The increase is either an ominous warning sign about an economic slowdown in the months ahead, or a one-month statistical fluke.

New housing sales went sharply negative in the latest month as well-no big surprise there given builders' bulging inventories of unsold units, but existing home resales took a surprising positive turn, up by four tenths of one percent.

Again, that could be nothing more than a statistical oddity, or it could be an indicator that the market is indeed finally bottoming out -- and higher sales numbers are just over the horizon.

Dr. Nothaft's own projection is for a "slow recovery" for housing, beginning sometime this Spring.

We'll keep you on top of all these moves in the market, but in the meantime keep this in mind: With mortgage money at these historically low rates, if you spot a well-priced house that fits your needs, get in the game and make a reasonable offer.

Published: January 10, 2008

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Kenneth R. Harney writes an award-winning, nationally-syndicated column on housing and real estate from Washington, D.C. He is also managing director of the National Real Estate Development Center, a professional education company. He is a past member of the Federal Reserve Board's Consumer Advisory Council, a committee that by federal statute reviews all Fed actions on home mortgage, consumer credit and banking industry regulation. He served as a member of the U.S. Department of Housing and Urban Development's Working Group on Computerized Loan Origination (CLO) systems, and is a member of the Editorial Board of the Fannie Mae Foundation's journal, Housing Policy Debate. He is the author of two books on mortgage finance and real estate.