In some highly optimistic crystal ball-gazing, the chief economist of the nation’s largest real estate group said that he is looking for a gradual improvement in the housing market next year with existing-home sales expected to grow 4%to 5% and new home sales getting a bigger boost.
At the recent National Association of Realtors (NAR) gathering in Anaheim, Lawrence Yun, NAR chief economist, said, “Tight mortgage credit conditions have been holding back homebuyers all year, and consumer confidence has been shaky recently.”
“Nonetheless,” Yun continued, “there is a sizeable pent-up demand based on population growth, employment levels and a doubling-up phenomenon that can’t continue indefinitely.”
Is this accurate forecasting or wishful thinking?
Last week, Yun also predicted that mortgage interest rates would gradually rise from record 2011 lows to 4.5% by the middle of 2012.
“Very favorable affordability conditions will dominate next year as well, which will probably be the second best year on record dating back to 1970. Our hope is that credit restrictions will ease and allow more homebuyers to take advantage of current opportunities.”
This just might be the first bit of promising news to hit the real estate market in many, many weeks. But agents everywhere aren’t jumping for joy just yet. While these estimates potentially indicate that the tide could be turning for the industry, this seems to be a case of “things can’t get much worse.”
How do you expect your 2012 to go? Are you expecting to see the same turnaround or do you think this is just an overly optimistic prediction?