The National Association of Realtors' latest forecast, released today, predicts that home prices are expected to recover in 2008 with existing-home sales picking up late this year and new-home sales rising early next year. Per the press release:
Existing-home sales are expected to total 6.11 million this year and 6.37 million in 2008, down from 6.48 million last year. New-home sales are projected at 865,000 in 2007 and 878,000 next year, compared with 1.05 million in 2006. Housing starts, including multifamily units, are forecast at 1.43 million units this year and 1.44 million in 2008, down from 1.80 million last year. Existing-home prices are likely to rise 1.8 percent to a median of $222,700 in 2008 after a 1.4 percent decline this year to $218,800. The median new-home price should rise 2.2 percent to $222,700 next year following a 2.6 percent drop in 2007 to $240,100.
A post at the Calculated Risk blog (Those Wacky NAR Forecasts) illustrates the issue here nicely: the NAR keeps offering downward revisions of each of its previous forecasts, yet doesn't so much as mention the downward revisions anywhere in its press releases -- choosing instead to focus on a recovery that at this point seems to be getting further off into the future. This latest NAR forecast shows the realtor org's expectations for existing-homes falling to 6.11 million in 2007, down from an estimated of 6.18 million in the prior month's forecast. The NAR was predicting 6.44 million in 2007 for the same measure way back in February, a number that has slid every month since that time. It's a similar story for new home sales and housing starts.