WASHINGTON — The sustained decline in mortgage rates will propel increases in all the major housing indicators this year, the National Association of Realtors said.

The 30-year fixed-mortgage interest rate will average 6.9%, against 8.1% in 2000, said David Lereah, the group’s chief economist.

“With interest rates near 30-year lows and historically low unemployment, we now expect both new- and existing-home sales, along with housing construction, to increase during 2001,” Mr. Lereah said.

“In other words, people with good jobs are looking at very good housing-affordability conditions in most of the country — they’re getting into the market and are helping to stimulate economic growth,” he said.

Though the economy still shows some weakness, Mr. Lereah said he expects existing-home sales to rise 1.6% this year, to 5.19 million units, and new-home sales to rise 2%, to 921,000 units.

The Realtor group predicts housing starts will rise 1.8% to a total of 1.62 million units this year, matching a construction pace not seen since 1987.

It also said it expects the national median existing-home price to rise 4%, to $144,600, and the median new-home price to be $173,900, which would be a 4.6% increase compared with 2000.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.