Professional Documents
Culture Documents
Outlook
By Lawrence Yun, Ph.D.
Chief Economist
National Association of REALTORS
May 14, 2015
Washington, D.C.
New
Existing
115.0
110.0
105.0
100.0
95.0
90.0
Source: NAR
Hitting Affordability
250
200
150
100
50
0
Regional Variation
Pending Sales Change from One Year Ago
25
20
15
10
5
0
-5
-10
-15
-20
Northeast
Midwest
South
West
Regional Variation
Median Price Change from One Year Ago
20
15
10
5
0
-5
Northeast
Midwest
South
West
2014
5.2 m
4.9 m
880 K
440 K
Mortgage Rates
8.0%
4.2%
Payroll Jobs
132 m
139 m
Population
282 m
319 m
Jobs
(8 million lost 12 million gained)
145,000
140,000
135,000
130,000
125,000
120,000
In thousands
In thousands
% Gain in 12
months
The Worst
% Gain in 12
months
Utah
4.0%
West Virginia
-0.7%
Florida
3.8%
Mississippi
0.5%
Oregon
3.4%
Maine
0.5%
Washington
3.4%
Montana
0.6%
California
3.2%
Alaska
0.6%
Georgia
3.2%
North Dakota
3.2%
Nevada
3.0%
Idaho
2.9%
40000
35000
30000
25000
20000
15000
10000
5000
0
Duke Basketball
Ticket Price?
Those who do not get the tickets after camping out is willing
to pay about $140 to get the ticket. Those who won the
the ticket are willing to sell for about $1500.
That is, a greater value placed and unwillingness to let go of
what one has in possession.
Do homeowners like their low mortgage rates and unwilling to
Give it up and hence staying longer than usual to make the move?
22
20
18
16
14
12
10
8
Reserve
(zero rate policy 7th and final
year)
%
Fed Funds
6
5
4
3
2
1
0
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Oil Price
160
140
120
100
80
60
40
20
0
21
19
12
11
10
9
8
7
6
5
Monetary Policy
Quantitative Easing Finished
Fed Funds Rate hike September
2015
Mortgage Rates reaching 6% by 2017
American Inequality?
Homeownership Rate
from 1990
70
69
68
67
66
65
64
63
Lowest in 25 years
Renters
(8 million more households)
44
42
40
38
36
34
32
30
Homeowners
(2.5 million fewer households)
77.0
76.5
76.0
75.5
75.0
74.5
74.0
All-Cash Sales
(% of total sales)
40
35
30
25
20
15
10
5
0
$ billion
2001
2004
2007
2010
2013
$250,000
$200,000
$150,000
$100,000
$50,000
$0
Renter
x31 x3 x4 x4 x3 x3
6
6
6
4
6
Homeowner
Stock Market
S&P 500 Index
2300
2100
1900
1700
1500
1300
1100
900
700
$ billion
In thousands
Change in
Ownership
Change in
Housing
Wealth
Inequality
Change in
Income
Equality
Bakersfield
-5.6%
$18,400
- 1.4%
Orlando
-4.3%
$31,500
-0.4%
Cincinnati
-3.5%
$13,000
-3.0%
New Orleans
-3.2%
$11,900
-4.2%
Atlanta
-3.2%
$29,700
-3.3%
Honolulu
-2.9%
$80,100
-0.8%
Austin
+0.8%
$37,700
+0.2%
Population
Baltimore City
(Total Jobs in thousands)
500
450
400
350
300
Other; 13%
Past
Internet;
4%Relationship; 22%
Personal Contact Meeting/Open House/Mailer; 14%
Economic Forecast
2013
2014
2.2%
2.6%
Job Growth
+2.3 million
+3.0 million
CPI Inflation
1.5%
1.6%
0.3%
3.2%
73
87
99
101
2.5%
2.6%
2.2%
3.3%
GDP Growth
Consumer
Confidence
10-year Treasury
2015
2016
Forecast Forecast
2.3%
3.0%
Housing Forecast
2013
2014
Housing Starts
925,000
1,001,000
1.1 million
1.4 million
430,000
437,000
570,000
720,000
5.1 million
4.9 million
5.3 million
5.5 million
Median Price
Growth
+ 11.5%
+ 5.7%
+ 6%
+ 4%
30-year Rate
4.0%
4.2%
4.0%
5.2%
Underwriting
Standards
Strict
Strict
Transition
Normal
Existing Home
Sales
2015
2016
Forecast Forecast