Realtors predict slow year in sales before ‘gradual upturn'
Home sales are expected to remain sluggish most
of the year and show “a gradual upturn”
leading into 2008, according to a recent forecast by the National Association
of Realtors. The trade group expects sales of new and existing homes to pick up
next year, but acknowledged they will most likely remain lower than 2006.
Home sales are expected to remain sluggish most of the year and show “a gradual upturn” leading into 2008, according to a recent forecast by the National Association of Realtors. The trade group expects sales of new and existing homes to pick up next year, but acknowledged they will most likely remain lower than 2006.
“Home sales will probably fluctuate in a narrow range in the short run, but gradually trend upward with improving activity by the end of the year,” said NAR senior economist Lawrence Yun. “It’s important to keep in mind that all real estate is local, and many markets are expected to have higher sales and strengthening prices during the second half of this year.”
Based on the forecast, existing home sales are expected to drop to 6.18 million from 6.48 million last year, before rising to 6.41 million in 2008. New home sales are also expected to drop, falling to 860,000 from 1.05 million last year, before rising to 901,000 in 2008. The trade group also predicted that housing starts will fall to 1.43 million units from 1.8 million last year, before rising to 1.49 million next year.
NAR also predicts that the national median existing-home price will fall 1.3 percent to $219,100 this year before rising 1.7 percent next year. Additionally, the median new-home price will probably fall 2.3 percent to $240,800 this year, and then grow by 2.6 percent in 2008, the group noted.
“Buyers today need to have a traditional view that housing as a long-term investment is an added benefit to their shelter expense. If so, that investment generally will build a nice nest egg over time, especially if they use a traditional mortgage instrument that reduces debt,” Yun said.
Growth in the U.S. gross domestic product is estimated to drop to 2.0 percent this year, lower than the 3.3 percent growth in 2006. The NAR noted that the GDP is set to grow to 3.0 percent in 2008.
Home sales are expected to remain sluggish most of the year and show “a gradual upturn” leading into 2008, according to a recent forecast by the National Association of Realtors. The trade group expects sales of new and existing homes to pick up next year, but acknowledged they will most likely remain lower than 2006.
“Home sales will probably fluctuate in a narrow range in the short run, but gradually trend upward with improving activity by the end of the year,” said NAR senior economist Lawrence Yun. “It’s important to keep in mind that all real estate is local, and many markets are expected to have higher sales and strengthening prices during the second half of this year.”
Based on the forecast, existing home sales are expected to drop to 6.18 million from 6.48 million last year, before rising to 6.41 million in 2008. New home sales are also expected to drop, falling to 860,000 from 1.05 million last year, before rising to 901,000 in 2008. The trade group also predicted that housing starts will fall to 1.43 million units from 1.8 million last year, before rising to 1.49 million next year.
NAR also predicts that the national median existing-home price will fall 1.3 percent to $219,100 this year before rising 1.7 percent next year. Additionally, the median new-home price will probably fall 2.3 percent to $240,800 this year, and then grow by 2.6 percent in 2008, the group noted.
“Buyers today need to have a traditional view that housing as a long-term investment is an added benefit to their shelter expense. If so, that investment generally will build a nice nest egg over time, especially if they use a traditional mortgage instrument that reduces debt,” Yun said.
Growth in the U.S. gross domestic product is estimated to drop to 2.0 percent this year, lower than the 3.3 percent growth in 2006. The NAR noted that the GDP is set to grow to 3.0 percent in 2008.
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