What Will Real Estate Look Like in 2015?

What Will Real Estate Look Like in 2015?We've entered 2015 with a relatively neutral housing market, thanks to home sales unexpectedly plummeting in November 2014.

What can we expect for the housing market in 2015? Will it soar in the beginning of the year, or will it take some time to build momentum? Here are some interesting projections recently published by the Real Estate Economy Watch which may provide some insight into the 2015 housing market.

The National Economy

The housing industry is based upon (and has little control) over one strong contributing factor - the national economy. Should the market have to weather job decreases, for example, we may see a slowing of pace.

Key elements are the employment growth in the millennial age cohort, ultimately impacting the first time homebuyer demographic.

Opinions on these economic trends differ, though there are a handful of experts that view the upcoming economic year in a positive light.

Market Projections from the Experts

Positive Market Projections

NAR's Lawrence Yun anticipates the total existing-homes sales to rise to 5.30 million in 2015 - a 7.2% annual increase from 2014. Additionally, the national median existing-home price is expected to moderate to a pace between 4 and 5% in 2015, with 2014 being up 5.6% from 2013.

Jonathan Smoke of Realtor.com is similarly optimistic, expecting home sales to increase 8% and prices to rise 4-5%.

CoreLogic is even more optimistic, predicting sales to rise 9% in 2015, with housing starts increasing 14% and home price appreciation becoming moderate.

Lukewarm Market Projections

Some experts are less enthusiastic. The Kiplinger financial publishing house, for example, forecasts home prices growing nationally by 3.5% in 2015. This is at the low end of the historical range (3-5% before inflation). Additionally, Kiplinger expects existing-home sales to increase 8% in 2015 and a new-home sales to rise 25% in 2015.

Freddie Mac's Frank Nothaft expects prices to appreciate at an average 3% in 2015, while sales will be up 5% - note that this would still be the best sales pace in 8 years.

In Sum?

All in all, experts seem relatively positive about the market, though the scale does differ from source to source. As a prospective homebuyer, it is advisable to buy early as prices and mortgage interest rates are unanimously anticipated to appreciate from all sources.

What do these numbers mean for you? Don't hesitate to send us an email or give us a call! We'll be happy to help.

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