UPDATE 1-Hardie sees U.S. housing market near bottom

* Q2 net operating profit rises to $37.6 mln

* Q2 sales fall 11 pct

* Cheaper freight, raw materials, higher selling prices help (Adds details, analysts' forecasts)

MELBOURNE, Nov 23 (Reuters) - Australian building materials maker James Hardie Industries NV (JHX.AX) predicted underlying full-year earnings would rise to meet the top of market forecasts as the U.S. housing market, the core of its business, troughs.

Hardie reported a four percent rise in second-quarter underlying profit on Monday, even as sales fell 11 percent, with the help of cheaper freight and raw materials and higher prices on its fibre cement products.

New home-building in the United States in the September quarter was 15 percent weaker than a year earlier.

"Despite this, there are some initial signs that the cycle appears to be nearing the bottom," Hardie said.

It warned that a housing recovery could be slow as new home buyers are still having difficulty getting credit, as the U.S. government ends a first-home buyers credit in April 2010 and as unemployment remains high.

The company said it expects full-year earnings excluding legal expenses, the costs of moving its home base to Ireland from the Netherlands and payments to asbestos victims, to be at the top end of analysts' forecasts of between $77 million and $115 million.

That would be up from $96.9 million a year earlier.

Net operating profit in the September quarter rose to $37.6 million from $36.2 million a year earlier.

With legal costs and asbestos payments, it slumped to a first-half loss of $97.5 million from a profit of $154.9 million. ((sonali.paul@thomsonreuters.com; +61 3 9286 1419; Reuters Messaging: sonali.paul.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))