Whether their prognostications pan out is a topic for discussion a year from now, but a survey of more than 20 top U.S. economic and housing experts predicts rising home sales and higher prices in the coming year.
The forecast, conducted on behalf of the National Association of Realtors, was unveiled at the organization’s second annual Real Estate Forecast Summit.
The overall consensus? Home sales nationally in 2020 will hit 5.52 million, the highest annual mark since 2006, with the median home price setting a record high of $293,000.
That would continue a trend of a hot-hot-hot housing market that has existed since the initial blast of pandemic pandemonium eased over the summer.
“It is an understatement to say the year 2020 has been filled with challenges and full of surprises,” said Lawrence Yun, chief economist for the National Association of Realtors. “Yet, one astonishing development has been the hot housing market as consumers eyed record-low mortgage rates and reconsidered what a home should be in a new economy with flexible work-from-home schedules.”
Of course, any prognostication comes with plenty of caveats – did any of those making forecasts a year ago take into account an international pandemic? – but here are some of the other views emanating from the survey:
• The panel expects growth in the gross domestic product to total 3.5 percent in 2021 and 3 percent in 2022.
• Annual median home prices are projected to increase by 8 percent in 2021 and by 5.5 percent in 2022.
• An annual unemployment rate of 6.2 percent is projected for 2021, falling to 5 percent in 2022.
• Average 30-year, fixed mortgage rates of 3 percent for 2021 and 3.25 percent for 2022 are indicated.
• Housing starts will total 1.5 million in 2021 and 1.59 million in 2022.
• The share of the U.S. workforce working from home is expected to be 18 percent in 2021 – down from 21 percent in 2020 – and 12 percent in 2022.
• Small declines in office- and hotel-vacancy rates in 2021, with a slight increase in retail vacancies next year.
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