NAR Economist Expects 7% Home Sales Increase

Washington, DC, Jan. 9, 2015 -- Existing-home sales are forecast to rise about 7% in 2015 behind a strengthening economy, solid job gains and a healthy increase in home prices, according to National Association of Realtors Chief Economist Lawrence Yun in a newly-released video.

"Home prices have risen for the past three years cumulatively about 25%, which boosts confidence in the market and traditionally gives current homeowners the ability to use their equity buildup as a downpayment towards their next home purchase," says Yun.

"Furthermore, first-time buyers are expected to slowly return as the economy improves and new mortgage products are made available in the marketplace with low downpayments and private mortgage insurance."

Despite his forecasted increase in sales, Yun cites the anticipated rise in interest rates, lenders being slow to ease underwriting standards back to normalized levels, and homeowners unwilling to move because they are comfortable with their current low interest rate as potential speedbumps that could slow the increased pace of sales this year.

Yun expects total existing-homes sales to finish the year around 4.94 million (down 3.0% from 2013), but then rise to 5.30 million in 2015. The national median existing-home price for 2014 will be close to $208,000, up 5.6% from 2013, and is expected to moderate to a pace between 4 and 5% in 2015.