First National Housing Price Decline Isn’t As Bad As It Sounds
by Blanche Evans
For the first time in 38 years, since the National Association of Realtors began tracking housing prices on a national scale, home prices are projected to fall instead of going higher, the trade group recently reported.
Median sales prices of existing homes are expected to fall 0.7 percent in 2007 to $220,300 before recovering to a modest 1.6% gain in 2008, says the NAR, following a modest 1.0 percent rise last year. The median new-home price is projected to increase 0.4 percent to $246,200 this year, after gaining 1.8 percent in 2006. Modest growth is expected next year, with existing-home prices increasing 1.6 percent and new-home prices rising 2.0 percent.
Reason to panic, or should Realtors and their clients take this number in stride?
According to NAR chief economist David Lereah, 2007 should still come in as the fourth-greatest housing market on record. That’s hardly a rout, but he cautions that the housing market should be impacted by tighter lending standards due to the subprime loan debacle.
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