NAR forecasts that existing home sales will increase by 13% in 2024 (compared to 2023) to 4.62 million units and in 2025 (compared to 2024) to 5.35 million units, an increase of 15.8%, and interest rates will be lowered four times. There is.
WASHINGTON – The number of pending home sales rose 8.3% in December, with the South, Midwest and West seeing monthly transaction increases and the North recording losses, according to the National Association of Realtors®. The South, Midwest, and West also recorded year-over-year increases, but the Northeast saw a decrease in transaction value compared to last year.
NAR's Pending Home Sales Index (PHSI), a forward-looking indicator of home sales based on contract closings, rose to 77.3 in December. Year-over-year, pending deals increased by 1.3%. An index of 100 corresponds to the level of contract activity in 2001.
“The housing market is off to a strong start this year as consumers benefit from lower mortgage rates and stable home prices,” said NAR Chief Economist Lawrence Yun. “Increased employment and rising incomes will further increase housing affordability, but increased supply is essential to meet all potential demand.”
Regional breakdown of PHSI:
South – December rose 11.9% to 93.0, up 1.5% year-on-year
Midwest – December increased by 5.6% to 80.5 people, an increase of 4.3% compared to a year ago
West – up 14.0% in December to 61.0, up 1.5% from December 2022
Northeast – 62.3, down 3.0% from last month and down 3.9% from December 2022
NAR Quarterly US Economic Forecast
NAR also announced the economic outlook as of January 2024, with existing home sales expected to increase by 13% in 2024 (compared to 2023) to 4.62 million units, and in 2025 (compared to 2024) to increase by 15.8% to 5.35 million units. I predict that it will. The annual median home price is expected to rise 1.4% to $395,100 in 2024 and 2.6% to $405,200 in 2025.
“Home sales are expected to increase significantly over the next two years as the market steadily returns to normal sales activity,” Yun added.
The Fed will probably cut rates four times. 30-year fixed mortgage rates are expected to remain in the 6% to 7% range for most of the year.
NAR expects that rent increases will subside and consumer price inflation will remain below 3% in 2024, as apartment construction has increased significantly over the past three years.
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