Despite a surge in new home sales reported last week, the National Association of Realtors predicts that the housing market will slow down by 2006.

"I think the market has shifted from the frenzied level of activity to a more manageable level," said Lawrence Yun, senior forecast economist at the NAR, adding that homeowners should not expect double-digit home price appreciation next year but just single digit growth in the ballpark of 4% to 6%.

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