Economists speaking at the International Builders’ Show in Las Vegas say the housing market will begin to pick up speed in its recovery during 2013, but note that this growth may be met with some opposition.

“Nearly every measure of housing market strength—sales, starts, prices, permits and builder confidence—has been trending upward in recent months and we expect to see gradual but steady growth along these lines in 2013,” says National Association of Home Builders (NAHB) chief economist David Crowe.

Crowe says house prices are up nearly 6 percent on an annualized rate over the past 10 months and “this has been a trigger for demand to return. People feel comfortable if they buy a house that it will appreciate, not depreciate, in value.”

According to the NAHB/First American Improving Markets Index low mortgage rates, strong housing affordability, rising household formations and the fact that two-thirds of U.S. housing markets can now be considered improving are several additional factors adding to the positive housing outlook. Housing has steadily increased its share of economic growth to 12.8 percent in the fourth quarter of 2012.

Crowe does caution that builders may face tight mortgage lending conditions, inaccurate appraisals, rising material prices and a declining inventory of buildable lots. The continued gridlock in Washington over debt stability in addition to calls for legislation on mortgage interest deduction, threaten to negatively impact consumer confidence and market demand.

Crowe reports residential remodeling has returned to previously normal level, with the benchmark as 2000-2003, and remodeling activity is expected to post a 2.4 percent increase in 2013 over last year.

Multifamily production, which has posted a 273 percent gain from 82,000 units in 2009 to 306,000 units in the final quarter of 2012, is expected to reach what is considered a normal level of production by 2014. The single-family market previously was running at 44 percent of normal production in the fourth quarter of 2012.

Single-family starts are expected to rise to 52 percent of normal by the fourth quarter of this year and 70 percent of normal by the fourth quarter of 2014. NAHB is forecasting 949,000 total housing starts in 2013, up 21.5 percent from 781,000 units last year. Single-family starts are anticipated to rise 22 percent from 535,000 last year to 650,000 in 2013, Crowe says. They are expected to jump an additional 30 percent in 2014 to 844,000 units. NAHB is anticipating that multifamily starts will increase 22 percent from 246,000 units last year to 299,000 in 2013, and rise an additional 6 percent to 317,000 units in 2014.

David Berson, senior vice president and chief economist at Nationwide Insurance, says it is still too soon to rule out the chance that conflict in Washington will lead to an economic downturn.

Berson projects gross domestic product (GDP) growth of 2 to 2.5 percent this year, with slower first-quarter growth in response to the unresolved spending issues before the economy picks up modestly as the year progresses. Should the full spending sequester be triggered and more than $100 billion in defense and non-defense cuts are implemented this year, then 2013 growth could fall to 1 to 2 percent.

“The problem is mortgage lending standards are way too tight,” he says. “If we were at a scale of nine or 10 in 2005-2006, we are at a two today. We want to be around a five.”

Berson also notes that several federal agencies will be releasing final rules later this year on a national qualified residential mortgage standard that could further restrict mortgage lending.

Frank Nothaft, chief economist at Freddie Mac, says 30-year, fixed-rate mortgages will stay below 4 percent through the end of 2013.

“An important stimulant driving housing demand has been declining mortgage rates,” says Nothaft. “These are the lowest rates we have seen in 65 years.”

The boom in refinancing for single-family homes associated with low mortgage rates is expected to continue this year but gradually diminish. Overall mortgage originations are forecast to fall 15 percent in 2013, but Nothaft says that home purchase originations will be trending higher, thanks to a projected 8 percent increase in home sales this year.

Nothaft forecasts 930,000 housing starts for 2013 and Berson projects starts could hit 980,000 this year.

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