DALLAS — D.R. Horton Inc., the nation's largest homebuilder, yesterday boosted its fiscal year earnings forecast, projected closing on a record 58,000 homes for the year and touted 29 percent first-quarter growth, despite signs that the housing market is leveling off.

Atlanta competitor Beazer Homes USA Inc. remained equally bullish while posting double-digit growth in the first quarter.

Their optimism, however, was met with separate reports out of Washington highlighting declining housing starts and fluctuating mortgage rates that economists say could stunt the market.

Horton Chief Executive Don Tomnitz said improved sales and margins produced $310.1 million net income, or 98 cents per share, up from $241 million, or 76 cents a share, a year ago.

Fort Worth-based D.R. Horton also raised its fiscal 2006 earnings-per-share outlook to a range of $5.25 to $5.35, and said it expects a second-quarter profit of $1.05 to $1.10 per share. In November, the company forecast fiscal-year earnings of $5.22 to $5.32 per share.

"We plan to continue to focus on the basics of the homebuilding business and distance ourselves from our competitors," said Tomnitz, whose company is anchored by first-time homebuying.

Last year, the company closed its 2005 fiscal year Sept. 30 with slightly more than 51,000 home closings and pledged to raise that number by almost 7,000.

"That is readily achievable," said Greg E. Gieber, analyst with A.G. Edwards & Sons Inc. "It's consistent with their growth strategy, and I see no apparent signs of eminent weakening based on data they reported."

D.R. Horton Inc. operates in Hawai'i as D.R. Horton Schuler Division.

Ian J. McCarthy, Beazer's chief executive, said earnings jumped from $69.7 million, or $1.57 a share, last year to $89.9 million, or $2 per share.

McCarthy also said the company plans to "meet or exceed" previously stated full-year profit forecast of $10.50 per share, a bump from $8.72 per share last year.

"Despite what appears to be a return to more normalized levels of activity in the overall U.S. housing market, we firmly believe the opportunities for increased market share gains are compelling," McCarthy said.

Any growth requires a deft adaptation to market conditions, said analyst Horan of Janney Montgomery Scott.

"It means building more houses per lot, building them farther out from main hubs, or making them smaller to keep them affordable to the buyer," Horan said. "It's a process that has been in motion for quite some time."

Despite each company's rosy outlook, economists believe rising interest rates could still send a chill into the housing market.

Interest rates have climbed steadily since 2004 and Wall Street expects another couple of interest rate increases by the Federal Reserve in coming months. The Fed's tighter credit policy has trickled into mortgage rates.

As mortgage rates continue to fall, the big question about the housing bubble looms, said D'Ann Petersen, associate economist for the Federal Reserve Bank of Dallas.

"Will it burst? Or will prices come down slowly? Will the mortgage rates go up? All are good questions," she said. "Things may slow for the first-time homebuyers a bit, but even if it's down a little bit, it's still going to be a pretty good year."

Shares of D.R. Horton fell $1.14, or 2.9 percent, to close at $38.86 on the New York Stock Exchange. The stock has traded in a 52-week range of $26.83 to $42.82.

Shares of Beazer rose $1.88, or 2.5 percent, to close at $78.69 on the NYSE. The stock has traded in a 52-week range of $43.99 to $82.14.