NEW YORK - The persistently strong housing market will get a boost in the aftermath of Hurricanes Katrina and Rita, as displaced homeowners need replacement homes, said Freddie Mac Chief Economist Frank Nothaft at the CPR & CDR's Prepayment and Mortgage Credit Modeling & Strategy Conference' held here last week.

However, with the two hurricanes shattering business and causing oil prices to rise, Nothaft is expecting lower GDP growth, 3.5%, for the rest of the year. Although by the first half of next year, he predicts GDP growth to be at 4.1% due to the rebuilding effort expected to take place. Energy price spikes are also seen as temporary - as refineries and pipelines are quickly being brought back in line - but high oil prices are here for the next few months, Nothaft said.

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