Although official sales figures for December are yet to be released, the National Association of Realtors (NAR) is forecasting that total existing-homes sales in 2015 increased 6.5% compared with 2014.
As of December, existing-home sales were at an annual rate of around 5.26 million, the highest since 2006 but roughly 25% below the prior peak set in 2005 (7.08 million), the firm says in its 2016 forecast.
The national median existing-home price for all of 2015 will be close to $221,200, an increase of 6.0% compared with 2014.
Currently, NAR is forecasting that existing-home sales will moderate considerably in 2016. Existing sales are expected to be in the range of 5.30 million to 5.40 million, an increase of only 1% to 2% compared with 2015.
Home prices are forecast to increase between 5.0% and 6.0%.
Despite the forecasted increase in sales, Lawrence Yun, chief economist for NAR, says rising mortgage rates, increasing home prices, slow wage growth and shaky global economic conditions will continue to create headwinds that will likely hold back a stronger pace of sales.
‘This year, the housing market may only squeak out one to three percent growth in sales because of slower economic expansion and rising mortgage rates,’ Yun says in a video. ‘Furthermore, the continued rise in home prices will occur due to the fact that we will again encounter housing shortages in many markets because of the cumulative effect of homebuilders underproducing for multiple years. Once the spring buying season begins, we'll begin to feel that again.’
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