Industry News

Realtor group forecasts 1.9% drop in U.S. resale home price

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The subprime market collapse and credit crunch has dealt a blow to sales of previously owned homes, the National Association of Realtors reported in a press conference today. While sales of resale homes were on an annualized pace of 6.17 million in the first half of 2007, sales dropped steeply to a 5 million annualized pace in October and November, and the subprime share of loans fell from about 20 percent of the market in the first half of the year to less than 1 percent in October and November. With the subprime market shattered and the market for jumbo loans also squeezed, the Realtor group expects the share of Federal Housing Administration loans to rise to about a 10 percent share of home-purchase loans in 2009, compared to about 4 percent this year. A forecast report released today by the Realtor group anticipates 5.67 million sales of resale homes this year, down 12.5 percent compared to 6.48 million sales last year. That follows an 8.5 percent decline from 2005 to 2...