Lawrence Yun, chief economist for the NAR, presented his midyear economic forecast at the 2016 Realtors Legislative Meetings & Trade Expo last week. According to Yun, despite being slightly uneven in the first quarter, existing-home sales came in at a seasonally adjusted rate of 5.29 million, higher than last year’s overall pace of 5.26 million. Despite rising home prices, demand is strong, bolstered by mortgage rates near three-year lows and the 14 million jobs added since 2010, Yun said.
“The housing market continues to expand at a moderate pace in spite of the fact that home prices are rising too fast in some areas because of insufficient supply fueled by the grossly inadequate number of new single-family homes being constructed,” he said. “The good news is that pending sales in recent months have remained stable and should support a modest gain in home sales heading into the summer.”
Yun said he projects existing-home sales to finish 2016 at a pace of around 5.40 million. If he’s correct, that would make 2016 the best year for existing-home sales since 2006.
Despite supply constraints and home price growth outpacing wages, existing-home sales are on track to come in at their highest pace in a decade this year, according to new data from the National Association of Realtors.