According to NAR’s Chief Economist Lawrence Yun, the good news is that the housing recession has officially ended—even though the recovery is just getting started.
What’s Changing?
- In June, pending home sales went up by 0.3%, marking the first gain after four months of decline
- Homes are flying off the market—76% of existing homes sold in June were on the market for less than a month
- But supply is still tight: Housing inventory dropped 13.6% compared to last year
Why It Matters
When homes sell quickly and bids are competitive, it means demand is high while supply is low. Homebuilders are responding by ramping up construction and hiring more workers
What Buyers Need to Know
- Higher prices and mortgage rates continue to be barriers—but things may improve soon
- Inflation is cooling and getting closer to the Fed’s target, which suggests that mortgage rates may have peaked
- If rates dip, we could see a surge of new buyers entering the market soon
NAR’s Forecast: What’s Ahead
NAR’s outlook through 2023 and into 2024 includes:
| Market Segment | 2023 Outlook | 2024 Outlook |
|---|---|---|
| Existing‑home sales | Expected to decline 12.9% versus 2022 | Projected to rebound 15.5% |
| Median home prices | Slight decline (~0.4%) to ~$384,900 | Expected to rise ~2.6% to ~$395,000 |
| New‑home sales | Forecast to climb 12.3% | Anticipated to grow another 13.9% |
| New‑home prices | May drop ~1.9% to ~$449,100 | Expected to increase 4.2% to ~$468,000 |
TL;DR (In Plain Language)
- The housing slump is behind us—but it’s not a full boom yet.
- Demand is strong, inventory is low, and homes are selling fast.
- Rates might be at their peak, which could boost buyer activity.
- NAR predicts a decline in existing-home sales this year with a strong rebound next year.
- New construction looks promising too, with prices stabilizing before climbing again.
Source: REALTOR® Magazine
“NAR Economist: ‘Housing Recession Is Over’”
National Association of REALTORS®
Reprinted with permission
