Prospects for 2008: Home sales forecast mixed

Sun., June 17, 2007

The Spokane Association of REALTORS® The Spokesman-Review

Home sales are projected nationally to move in a relatively narrow range with a gradual upturn becoming more pronounced by the end of the year, according to the latest forecast by the National Association of REALTORS®.

“The market is relatively soft although overall housing levels are historically strong, but sales remain sluggish compared to the recent boom,” said Lawrence Yun, NAR senior economist. “Home sales will probably fluctuate in a narrow range in the short run, but gradually trend upward and improving by the end of the year.

“It’s important to keep in mind that all real estate is local, and many markets are expected to have higher sales and strengthening prices during the second half of this year,” Yun said.

Existing sales are projected to total 6.18 million in 2007 and 6.41 million next year. New home sales are forecast at 960,000 this year and 901,000 in 2008.

“We continue to experience a temporary distortion in comparing median existing-home prices,” Yun said. “Because the sales volume has shifted from many high-cost areas to moderately priced markets, we’re not getting a true apples-to-apples comparison.

“Buyers today need to have a traditional view that housing is a long-term investment is an added benefit to their shelter expense. If so, that investment generally will build a nice nest egg over time, especially if they use a traditional mortgage instrument that reduces debt,” Yun said.

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