NAR: Housing Market Is Stabilizing
December 31, 2013
Contracts to buy new homes leveled off in November, ticking up slightly by 0.2 percent, the National Association of REALTORS® reports. Pending home sales — which reflect contracts and not closings — were 1.6 percent below year-ago levels.
“We may have reached a cyclical low because the positive fundamentals of job creation and household formation are likely to foster a fairly stable level of contract activity in 2014,” says Lawrence Yun, NAR’s chief economist. “Although the final months of 2013 are finishing on a soft note, the year as a whole will end with the best sales total in seven years.”
Pending home sales in November posted the largest gains in the South and West, rising 2.3 percent and 1.8 percent month-over-month, respectively. The increases helped to offset declines in pending home sales in the Northeast (down by 2.7 percent in November) and the Midwest (down by 3.1 percent).
Total existing-home sales are expected to end the year with nearly a 10 percent gain over 2012. However, Yun says that existing-home sales will likely remain at around 5.1 million in 2014. A rise to 5.3 million in existing-home sales is expected for 2015.
Existing-home prices for 2013 are expected to be about 12 percent higher than year-ago levels, averaging $197,300. NAR predicts that home prices will grow modestly in 2014 at a pace of 5 to 5.5 percent, and values will increase another 4 percent in 2015.
— By Melissa Dittmann Tracey
Updated: May 29, 2020