News Article From: 04-12-2007
The first article, Group predicts median home prices will drop, from MSNBC.com, reports that the National Association of Realtors (NAR) on Wednesday said it expects the national median price for an existing home to drop this year for the first time since the NAR began tracking records in the late 1960's. The NAR also lowered its 2007 sales forecast for new and existing homes. Tighter lending standards and the continued fallout from the subprime mortgage market are to blame, NAR spokesman Walter Molony said. NAR is forecasting a 0.7 percent dip in 2007 national median price for existing homes after a 1 percent gain last year. NAR is also forecasting a 14.2 percent decline in new home sales, and predicts that sales of existing homes will fall 2.2 percent this year.
The second article, Rising interest rates expected to cool housing sales, from the Business Journal of Phoenix, also reports on the latest National Association of Realtors forecast. It ads that the national median resale price will slip to $220,300 in 2007, and that the price for a new home is projected to increase 0.4 percent to $246,200. NAR is predicting modest growth in 2008, with existing home prices increasing 1.6 percent and new home prices rising 2.0 percent. Freddie Mac also predicts that 30-year mortgage rates, currently at 6.17 percent, will rise slowly this year to 6.6 percent by the end of the year, so borrowers who need to refinance should act soon. On the local scene, the article quotes ASU Realty Studies director Jay Butler as saying " everyone expects this year to be slower and lower." As for 2007, Butler said those who have owned their homes for a number of years likely will see gains, but investors and others turning homes bought only a year ago may see a drop in prices.