Sales are expected to increase in 2016, according to the National Association of Realtors, Moody’s Analytics, and Ellie Mae
According to the National Association of Realtors (NAR), existing-home sales are expected to increase at a moderate pace in 2016.
NAR chief economist Lawrence Yun, along with experts from Moody’s Analytics and Ellie Mae, shared their thoughts on the economic and housing forecast at the 2015 Realtors Conference & Expo in November.
Yun said that 2015 was a fantastic year for the housing market because rising home values and sustained job growth gave homeowners reason to sell.
“Sales activity in 2016 will once again be primarily driven by the ongoing release of more pent-up sellers finally realizing their equity gains and using it toward the down payment on their next home,” Yun said in a statement.
Home sales are expected to expand 3 percent to 5.45 million in 2016, and the national median existing-home price could rise 5 percent during the year. Yun also said that single-family housing starts could reach 1.3 million in 2016, which is below the 1.5 million that is needed to keep up with current demand.
First-time buyers’ participation in the market fell to its lowest point in 30 years, at 32 percent. While the job market has improved, rents, student loans, and other expenses have increased, limiting young potential buyers’ ability to save money for a home. Yet, Yun said the new-buyer market could rebound as early as 2017.
“Their emergence back into the market will be a gradual one, but our data does show that young adults view homeownership as a good financial investment and part of their personal American dream,” Yun said.