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However, existing-home sales will likely fall 12.9% to a 4.38 million rate in 2023, according to NAR. But existing sales will rebound 15.5% to 5.06 in 2024. Meanwhile, NAR projects a 12.3% jump in new home sales, up to 720,000 units in 2023, and another 13.9% in 2024 to 820,000. Housing starts will decline 5.3% to 1.47 million in 2023 before increasing 5.4% to 1.55 million in 2024.
First American economist Ksenia Potapov noted that the divide between the existing-home and new-home markets continues to grow.
The national median existing-home price will remain stable – dipping 0.4% to $384,900 before bouncing back 2.6% next year to $395,000. New home price growth will also slow this year before improving, with the median price down 1.9% to $449,100 in 2023 and then up by 4.2% to $468,000 in 2024.
“While existing-home sales remain muted, multiple leading indicators on the new-home side, including new-home sales, new-home construction, and homebuilder sentiment, have trended higher,” Potapov said. “There is plenty of demand on the sidelines, the labor market remains strong, and potential home buyers are ready to jump in. While limited inventory is likely to hold back sales activity, the housing market remains resilient.”
“It is critical to expand supply as much as possible to widen access to homebuying for more Americans,” Yun said. “Home prices will be influenced by how much inventory is brought to market. Increased homebuilding will tame price growth, while limited construction will lead to home price appreciation outpacing income growth.”
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