Industry News

NAR expects home sales to drop in ’07, rebound in ’08

Forecast calls for dip in median resale home prices this year

The National Association of Realtors expects an 18.3 percent drop in housing starts, a 13.9 percent drop in new-home sales and a 2.2 percent decline in existing-home sales this year compared to 2006, according to the trade group's latest forecast. "Tighter lending criteria and fallout from the subprime loan debacle will lead to a healthier housing market with greater assurance that owners can handle mortgage adjustments," the association announced, "but higher loan standards will slow the housing recovery." The national median existing-home price is expected to decline 0.7 percent this year to $220,300, following a 1 percent rise last year, while the median new-home price is expected to increase 0.4 percent to $246,200 in 2007 after a 1.8 percent gain last year. In 2008, existing-home prices are expected to increase 1.6 percent and new-home prices are expected to gain 2 percent. Existing-home sales are expected to total 6.34 million this year and 6.52 million next year, compared with 6...