Following up on an April 25 meeting at which the NAHB Senior Officers and members of the association?EUR??,,????'???s senior staff advised Federal Reserve Chairman Ben Bernanke of conditions in the housing market, including downside risks to a baseline forecast for a moderate and orderly decline in starts and sales this year, Seiders provided the chairman last week with additional information from the association?EUR??,,????'???s regular surveys of its builder members.

?EUR??,,????'??Mr. Chairman, we trust that you will keep the downside risks to the interest-sensitive housing sector in focus as you guide monetary policy management during the balance of 2006,?EUR??,,????'?? Seiders wrote to Bernanke.

Following records for single-family housing starts and new home sales in 2005, housing starts are on their way to a projected 6.1 percent decline this year, according to NAHB forecasts, and new home sales are expected to decrease by 12.9 percent. However, Seiders indicated that investors/speculators are now pulling out of the single-family and condo markets, creating some uncertainties for the marketplace.

Seiders reported to the Fed chairman that NAHB?EUR??,,????'???s single-family Housing Market Index has been falling since mid-2005, and hit a reading of 45 in May, its lowest level since mid-1995, ?EUR??,,????'??an episode that also followed systematic tightening of monetary policy by the Federal Reserve.?EUR??,,????'?? Seiders added that there is a possibility the index will decline ?EUR??,,????'??somewhat further?EUR??,,????'?? in coming months.

In an address to the NAHB Board of Directors earlier this month, Seiders emphasized that ?EUR??,,????'??the U.S. economy definitely is slowing down at this time.?EUR??,,????'?? Seiders said that he expects the growth of the Gross Domestic Product to slow to a rate of 3 percent in the second half of this year and in 2007, which will prevent the economy from overheating and falling into a recession.

Seiders also said that the Fed appears to be approaching the end of its run of quarter-point hikes in its federal funds interest rate, although another incremental increase is possible at the next meeting of the Federal Open Market Committee on June 29.