Builders Look for Housing To Recover in 2007

Homebuyers have been backing out of sales contracts and forfeiting their down payments during the housing slowdown, but cancellation rates should steady in the first quarter and taper off later in 2007, said the chief executive of one of the nation's largest home builders Thursday.

"Cancellations are likely to stabilize and stay level this quarter, and then decrease," said Ara Hovnanian during a Web cast of a real estate conference sponsored by Deutsche Bank in New York, adding cancellations should get back to "normalcy in a quarter or two."