Housing market expected to Rebound in 2008

The National Association of Realtors expects that existing home sales will rise to nearly 6.4 million in 2008, which is up 6.1 million from the 2007 estimate. As for new homes, sales are projected to be at 865,000 homes sold in 2007, and 878,000 sold in 2008. More than 1.4 million housing starts, which include multifamily units, are expected this year and in 2008, which is down from 1.8 million in 2006.

All in all, existing-home prices are expected to gain 1.8 percent to a median of $222,700 in 2008 after this year’s decline of 1.4 percent to $218,800. The median of new home prices should rise 2.2 percent to $245,400 next year after this years 2.6 percent drop to $240,100. “Markets that sharply reduce new construction in 2007 will generally experience respectable price increases in 2008,” said Lawrence Yen, NAR senior economist in a release. “Buyers now have an overwhelming advantage given the wide selection of homes available in many markets. But with profit margins coming under pressure, homebuilders will limit new construction well into 2008.”

With these estimates, the market can still be viewed as very buyer friendly until next year when prices begin to increase as projected. However, with banks tightening up on who they are willing to qualify, it will continue to become harder and harder for buyers to qualify for financing.

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Joshua Talayka
Chase International
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Reno, Nevada (NV) 89521



Source of information: The Reno Gazette Journal