NAR Expects Existing Home Sales to Close 2015 at Nine-Year High

Washington, DC, May 15, 2015— Existing home sales are expected to finish the year at their highest pace since 2006, but accelerating price growth and rising mortgage rates have the potential to slow sales, according to the National Association of Realtors (NAR).

Lawrence Yun, chief economist of NAR, says existing home sales are measurably higher than a year ago, and strengthened in March as more buyers entered the market as the spring buying season got underway, citing sustained job growth and interest rates below 4% as the catalyst behind the improvement in sales.

Yun further explains that the demand for buying is especially strong in parts of the country where jobs gains and economic activity have outpaced the rest of the nation, particularly in states like Utah and Florida and cities such as Denver.      

After falling slightly below a pace of 5 million in 2014, Yun expects home sales to rebound and steadily improve, ending up at a pace around 5.30 million (the highest since 2006) this year and 5.5 million in 2016.

Yun expects the national median existing-home price to rise to around 6% this year (5.7% in 2014) before moderating to 4% in 2016.

On the topic of home prices, Yun said increasing demand in recent months, without meaningful gains of new and existing homes available for sale, is starting to negatively impact affordability and is pushing price growth to unhealthier levels.