Smoke: We expect new home sales to be up 10 percent as the tight existing home inventory continues to favor healthy and profitable growth for homebuilders. We do not forecast new home prices but would expect new home prices to be flat or even down assuming that much of the growth in new home sales should be coming from the first-time buyer segment. Muoio: New home sales and prices should also rise in 2017 for the same reasons as existing homes. New homes should also help satisfy underlying housing demand amid a tight inventory of existing homes, continuing to lift sales and prices for new homes. A rise in housing starts could help boost new home sales, but not raise supply high enough to dent prices. Gardner: Last year, I suggested that we would see a major increase in new home sales and, by years’ end, we are likely to see sales up by about 14 percent. In 2017, I anticipate sales will continue to increase, but by a slightly more modest 12.2 percent. I anticipate that new home prices will rise by a fairly modest 3.1 percent as construction costs weigh on prices. Villacorta: New home sales are also likely to increase in 2017. According to the U.S. Department of Commerce, housing starts reached a post-recession high this fall and for most major metros across the nation, positive performance during 2016 suggests there is a healthy appetite for continued construction.
Since the beginning of 2016, the national average for days on market has decreased by over a week to around 40 days for both performing and distressed properties, indicating that the demand for homes is still far outpacing any previous increases in supply. In 2017, a steady stream of new homes will be added to the existing housing stock as the result of a multi-year trend in increasing housing starts, providing an improvement to the housing supply and helping to relieve areas particularly stricken by low inventory. In these tight markets, new home sales are likely to moderate runaway price growth and aid in affordability. In areas where the housing supply is already well serving homebuyer demand, any increase in the supply of homes on the market could
result in lower home prices for both new and existing homes.
Becketti: Sales up. Prices up.
Weiss: Renters who are accustomed to higher end apartment living will put a premium on new construction because it is most like renting. Spanking new appliances, and a “full service” professional seller, eager to provide amenities and customizations will be familiar and worth the premium. This will put upward pressure on new home sales prices. 4) Where are mortgage interest rates headed in 2017 (up, stay the same, or negative)?
U.S. Home Prices & Interest Rates Jan 2000 to Dec 2016 Median Sales Price Conforming 30-Year Fixed-Rate Mortgage Rate U.S. HOME PRICES & INTEREST RATES JAN 2000 TO DEC 2016 Median Sales Price Freddie Mac Conforming 30-Year Fixed-Rate Mortgage Rate
ATTOM Data Solutions • P8
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