WASHINGTON, DC — The U.S. housing market is on “firm ground,” although in order for the market to be healthier, additional housing supply is needed to assure that home prices do not consistently outgrow income gains, the chief economist for the National Association of Realtors said last month.
NAR Chief Economist Lawrence Yun issued that projection at the association’s recent “Real Estate Forecast Summit,” a gathering of leading economists at NAR’s headquarters. The economists issued a consensus economic and real estate forecast, predicting that the U.S. economy would continue expanding in 2020, with real estate prices rising and a recession remaining unlikely.
The economists predicted a 29% probability of a recession in 2020, along with an annual unemployment rate of 3.7%. Average annual 30-year fixed mortgage rates of 3.8% and 4.0% are expected for 2020 and 2021, respectively. Annual median home prices are forecasted to increase by 3.6% in 2020 and by 3.5% in 2021.
“Residential real estate investment remains attractive as we approach the start of a new decade,” said NAR President Vince Malta. “Increased home building can serve as a stimulator for the overall economy, and we strongly encourage more homes to be built as buyer demand remains strong.”
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