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Realtors expect strong sales through 2019

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2019-05-31

Continued economic expansion, rising home sales and an increase in wage growth that is on par with home price growth are some of the expectations for the second half of 2019, according to speakers at last weeks residential real estate forum at the 2019 REALTORS Legislative Meetings & Trade Expo.


Dr. Lawrence Yun, chief economist at the National Association of Realtors, delivered his 2019 midyear forecast, which predicted changing future migration patterns as buyers search for more affordable markets. Inventory in the U.S. has grown for eight straight months on a year-over-year basis, and Mr. Yun expects that to continue.


Home sales should be much stronger based on the economic fundamentals of jobs, interest rates, population and consumer confidence,said Mr. Yun.


After several years of wage growth outpacing home price growth, this year both are more closely aligned as average hourly wages accelerate. With strong job creation, wages are growing at a faster pace. Finally, wages and home prices are aligning,Mr. Yun said. This is good news for employees.He added that this shift is a healthy development toward keeping housing affordability stable.


That said, because of significant differences in home prices between metro markets, Mr. Yun said there may be a steady shift in the relocation of people and companies into more affordable regions of the country. Housing affordability had been falling according to NARs Housing Affordability Index.


While affordability has been sliding, it is still better than we saw in the year 2000. This is due to much lower mortgage interest rates today,Mr. Yun said.


Danielle Hale, chief economist at realtor.com, also spoke and projects that year-over-year inventory growth will be moderate nationwide. Realtor.com has seen listing prices up 6.9% year over year in April. The REALTORS Affordability Distribution Curve and Score produced by NAR and realtor.com shows that higher income households have more access to available inventory.


We used to see home price growth only around the coasts, but now were seeing it throughout the country. Nationwide there are not enough affordable homes on the market, and those numbers have been declining,Ms. Hale said.


The National Association of Realtors is Americas largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries. 

 

SOURCE: National Association of Realtors