WASHINGTON -- The U.S. housing market will continue its strong performance through 2001 as the economy rebounds and long-term interest rates remain low, housing finance giant Fannie Mae reported.

"Total home sales, while not quite a record this year, will be very close," said David Berson, Fannie Mae's chief economist.

New home sales should climb to a record 889,000 units sold in 2001, Berson said in his semi-annual economic and mortgage outlook.

Existing home sales are projected to be down by 3%, at 4.93 million units, he said. However, the sales pace has been picking up through April, Berson added.

The economist saw a period of fairly stable long-term rates as the U.S. economy rebounds and inflation dips. Fixed-rate 30-year mortgages should remain at around 7.0% to 7.2% for the next year, he said.