Prices for existing home sales nationwide rose just barely over 1% last year. That's not much compared with the double digit appreication in the previous years. And regionally--neighborhood to neighborhood--prices dropped and continue to fall. So what is the state of the U.S. housing market? Bill Emerson is CEO of Quicken Loans [ INTU 44.01  +0.01 (+0.02%) ]. He appeared on "Squawk Box to discuss the issue.

Emerson says that for he thinks the home buying market will pick up by mid 2007. He expects home mortgage rates to be around 6 1/4 and 7%--and he says that's good for homeowners. Emerson also says inventories are a key part of the equation. He says that we need to watch if inventories of homes are going down because they're sold--or because people are getting discouraged and taking them off the market. He also says a strong economy is important for home sales--and tied to jobs as an indicator that the economy is doing well. He said the next couple of months will be key.

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