NAR Forecasts Modest Increase in Existing-Home Sales for 2018

Nov 03, 2017

May’s home sales are at a pace that have not been seen over the past decade

Existing-home sales will finish 2017 at a pace of 5.47 million, the best volume in 11 years, but only a scant 0.4 percent higher than last year’s 5.45 million, according to data from the National Association of Realtors (NAR). In 2018, NAR predicts existing-home sales will rise by 3.7 percent to 5.67 million.

NAR also forecast a 5.5 percent increase in the national median existing-home price for this year and next year. is expected to rise to around 5.5 percent this year and next year. However, the trade group also noted that first-time buyers accounted for only 34 percent of sales over the past year, the fourth lowest level since NAR began tracking this date 36 years ago.

“The lack of inventory has pushed up home prices by 48 percent from the low point in 2011, while wage growth over the same period has been only 15 percent,” said NAR Chief Economist Lawrence Yun. “Despite improving confidence this year from renters that now is a good time to buy a home, the inability for them to do so is causing them to miss out on the significant wealth gains that homeowners have benefitted from through rising home values.”

Yun also forecast single-family housing starts to rise by 9.4 percent to 950,000 next year. New single-family home sales are likely to total 606,000 this year and rise to around 690,000 in 2018, Yun added, with an extra prediction that mortgage rates will gradually climb towards 4.50 percent by the end of 2018.

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Phil Hall

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Nov 03, 2017

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