Us home sales to top 5 million in 2015

Photo: Fifth World Art

Existing-home sales are forecasted to rise about 7 per cent in 2015, reaching a total of 5.3 million. Sales in 2014 are estimated total around 4.94 million down 3 per cent from 20143's total, but the improving US economy and falling unemployment are expected to give the market a boost in the coming year.

Indeed, there is continued growth in the labor market and home prices rising at a moderate but healthy clip, according to NAR Chief Economist Lawrence Yun, a combination that is boosting positive sentiment.

"Home prices have risen for the past three years cumulatively about 25 per cent, which boosts confidence in the market and traditionally gives current homeowners the ability to use their equity buildup as a downpayment towards their next home purchase," says Yun.

"Furthermore, first-time buyers are expected to slowly return as the economy improves and new mortgage products are made available in the marketplace with low downpayments and private mortgage insurance."

Despite his forecasted increase in sales, though, Yun cites the anticipated rise in interest rates, lenders being slow to ease underwriting standards back to normalized levels, and homeowners unwilling to move because they are comfortable with their current low interest rate as potential speedbumps that could slow the increased pace of sales this year.

The median existing-home price for 2014 will be close to $208,000, forecasts the NAR, up 5.6 percent from 2013. This is expected to moderate to a pace between 4 and 5 per cent in 2015.