NAR Trims Housing Sales Forecast, Again

Washington, DC, August 8, 2007--The pace of home sales will fall further in 2007 than earlier expected but prices will drop less sharply than previously thought, according to the latest forecast by the National Association of Realtors.

The Realtors trimmed their sales forecast for the sixth straight month but pared back its predicted drop in existing home values.

Existing-home sales should hit a pace of 6.04 million units this year, down from the 6.11 million units it predicted last month.

The national median sales price for existing homes should ease by 1.2% to $219,300 this year. Last month the trade group said prices should slip 1.4%.

The median new-home price will probably fall 2.3% to $240,800 this year, the NAR said in its monthly economic outlook.

The 30-year fixed-rate mortgage is forecast to average 6.7% in the fourth quarter and then ease to the 6.5% range next year.

Growth in GDP is projected to be 1.9% this year, down from a 2.9% growth rate in 2006; GDP is expected to grow 2.8% next year.

The unemployment rate is estimated to average 4.6% this year, unchanged from 2006. Inflation, as measured by the Consumer Price Index, is likely to be 2.7% this year, down from 3.2% in 2006. Inflation-adjusted disposable personal income should rise 3.1% in 2007, the same as last year.