Housing organizations predict expansion in 2010
The consensus forecast among major real estate organizations is for the housing downturn to come to a close in 2009 and for the expansion to begin in 2010 according to a compilation of housing forecasts released yesterday on Real Estate Economy Watch.com. The Web site presented available September housing forecasts of the National Association of Realtors, the National Association of Homebuilders, the Mortgage Bankers Association, Fannie Mae and Freddie Mac and then calculated the consensus (mean) prediction for each major housing measure for the group as a whole.
The group consensus predicted a sharp contraction in the housing industry this year, led by a 36.2 percent drop in new residential construction (housing starts) and a 17.1 percent drop in new home sales. The group projected that existing home sales would tread water, growing by only 0.3 percent. It is likely that existing home sales were bolstered by foreclosure sales throughout most of 2009. According to the National Association of Realtors’ economists, foreclosure sales comprised almost 50 percent of total existing home sales during the first quarter of this year and then averaged about a 33 percent share of sales during the second and third quarters.
Looking forward to 2010, the organizations are generally in agreement with home sales and housing starts, but differed markedly on home price predictions. The group consensus projected that existing home sales would increase 9.6 percent to 5.403 million units in 2010 compared to an estimated 4.929 million units registered in 2009.
Source: David Lereah, realestateeconomywatch.com