Despite continuing inventory, affordability and student loan hindrances to homeownership, the National Association of Realtors (NAR) predicts 2016 will be the strongest year for existing home sales since 2006. Lawrence Yun, the NAR’s chief economist, speaking at the association’s Legislative Meeting,predicts pre-owned home sales will hit 5.4 million this year, and home prices will rise an average of 4.5 percent.
Sen. Elizabeth Warren (D-MA) emphasized the need for student loan reform saying it can “breathe new life into housing markets.” She referenced the seven out of ten college graduates who take out student loans and then have to pay it back for years at high interest rates.
As constructiondive tells MHProNews, Yun said sluggish housing starts are slowing the overall market and that builders need to increase the inventory of starter homes. Leaving out the starter homes results in new home prices rising faster than existing sales.
Noting the restrictions imposed by Dodd-Frank on banks of all sizes, Yun said, “Much of the lending for single-family housing starts historically has been among the community bank and the smaller-sized banks,” he said. “Smaller banks are hindered by this massive new regulation. Now they are frozen, and they are not making those loans.” ##
(Photo credit: wktv–home for sale)
