Real Estate realtors in the US are confident about 2010 and predicting that home sales will increase 13.6% in 2010 and prices rise up to 5%. The latest report from the National Association of Realtors predicts that both existing home sales and new builds will increase as many first time buyers take advantage of special policies to encourage them onto the housing ladder.
It is projecting that as many as 2.4 million first time homebuyers took advantage of the $8,000 tax credit. First-time buyers accounted for 47% of home sales in 2009, up from 41% in 2008 and a low of 36% in 2006, NAR added.
NAR expects that existing home sales will total 5.01 million in 2009, up 2% from 2008, and will increase again to 5.69 million in 2010.
‘A steady draw down of inventory will help home values to turn positive in 2010, but risks such as unemployment remain in the economy,’ said NAR chief economist Lawrence Yun.
Other NAR projections include new home sales at 397,000 this year, and increasing to 549,000 in 2010. NAR projects housing starts, including multifamily units, are expected to total 564,000 units in 2009 and grow to 752,000 in 2010.
NAR also projects that 30 year fixed rate mortgages will average 5.3% during the last quarter of 2009 and that will increase to 5.8% by the end of 2010.
‘We’ve seen a steady downtrend in housing inventory for well over a year and home prices appears to be in the early stages of stabilizing. With expansion of the tax credit to additional buyers through the middle of next year and no major unforeseen events impacting the economy, home prices should rise between 3 and 5% in 2010, but with wide geographic differences,’ Yun added.