John's Florida Real Estate Blog

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National Association of REALTORs (NAR): Home prices to recover in 2008

WASHINGTON, July 11, 2007 PRESS RELEASE

Home prices are expected to recover in 2008 with existing-home sales picking up late this year and new-home sales rising early next year, according to the latest forecast by the National Association of Realtors®.

Lawrence Yun, NAR senior economist, said a good buyers’ market has evolved. “Buyers now have an overwhelming advantage given the wide selection of homes available in many markets,” he said. “But with profit margins coming under pressure, homebuilders will limit new construction well into 2008. This should help the overall inventory level to move steadily into a more balanced state.”

Existing-home sales are expected to total 6.11 million this year and 6.37 million in 2008, down from 6.48 million last year. New-home sales are projected at 865,000 in 2007 and 878,000 next year, compared with 1.05 million in 2006. Housing starts, including multifamily units, are forecast at 1.43 million units this year and 1.44 million in 2008, down from 1.80 million last year.

Existing-home prices are likely to rise 1.8 percent to a median of $222,700 in 2008 after a 1.4 percent decline this year to $218,800. The median new-home price should rise 2.2 percent to $245,400 next year following a 2.6 percent drop in 2007 to $240,100.

“Markets that sharply reduce new construction in 2007 will generally experience respectable price increases in 2008,” Yun said. “Local conditions vary considerably, but with historically low mortgage interest rates this summer and sustained job gains, it could be a good time for first-time buyers with a long-term view to test the housing waters.”

The 30-year fixed-rate mortgage is estimated to average 6.7 percent during the second half of this year, and fluctuate around 6.6 percent in 2008.

Growth in the U.S. gross domestic product (GDP) will probably be 2.0 percent in 2007, compared with a 3.3 percent growth rate last year; GDP is forecast to grow 2.8 percent in 2008.

The unemployment rate is likely to average 4.6 percent in 2007, unchanged from last year. Inflation, as measured by the Consumer Price Index, is projected at 2.6 percent in 2007, down from 3.2 percent last year. Inflation-adjusted disposable personal income should rise 3.0 percent this year, up from a 2.6 percent gain in 2006.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries.

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Existing-home sales for June will be released July 25; the Pending Home Sales Index is scheduled for August 1 and the next forecast will be August 8.

SOURCE: National Association of REALTORs Press Release and PRINTED WITH THEIR PERMISSION. NOTE: Using a press release is not plagarism and NAR has told me I can use them, just as many of our state REALTOR associations do.

Note from JOHN: Let's hope that for the sake of sellers and real estate professionals (and those who depend on them) that there may be a glimmer of light at the end of this tunnel. And that it is not a train coming toward us!!

John Elwell - REALTOR

CENTURY 21

Bill Nye Realty, Inc.

813-783-4444

Licensed in Florida

 

Comment balloon 3 commentsJohn Elwell • July 12 2007 08:17PM

Comments

I saw this article and it made me cautiously hopeful. I have to admit I have buyers right now so that part is great. I just wish the numbers of homes available weren't so high in most neighborhoods here.

Btw, I was reading your profile. We are both former teachers.  I was a social studies teacher what about you?

Posted by Carole Cohen, Realtor, ePRO (Howard Hanna Cleveland City Office) about 12 years ago
I taught elementary mostly. 8 years in Florida and 12 in Spain. When I came back in 2002 I taught one year at the high school level, that was enough for me. No longer fun doing it here. Too many bad attitudes. Thus I am in real estate :)
Posted by John Elwell, You Deserve a Full-Time Agent, Not Reduced Results (CENTURY 21 Bill Nye Realty, Inc.) about 12 years ago
Spain! I bet you have great stories...what a fabulous experience. lol about the high school experience. I loved (love) high school aged kids...maybe because I never had any of my own they do not push my hot buttons lol.  I couldn't get along with the administrations.  Thus I am in real estate! Anyway, it's nice to meet you in the Rain and I look forward to reading your posts.
Posted by Carole Cohen, Realtor, ePRO (Howard Hanna Cleveland City Office) about 12 years ago

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