Gradual improvement in the housing market is expected next year, with existing home sales edging up 4% to 5% and new home sales getting even bigger boost off this year’s record lows, the chief economist of the nation’s largest real estate group said on Friday.
Lawrence Yun, chief economist for the National Association of Realtors, projected gross domestic product growth of 1.8% for 2011, rising to 2.2% in 2012 with the unemployment rate declining to 8.7% by the second half of 2012.
He predicted mortgage interest rates will gradually rise from record 2011 lowest to 4.5% by middle 2012. Very favorable affordability conditions will dominate next year as well, which will probably be the second best year on record dating back to 1970.
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