We are On Track Real Estate World

Dated: 12/19/2019

Views: 123

Expect Continued Economic Growth, Slower Real Estate Price Gains and Small Chance for Recession in 2020, According to Group of Top Economists

WASHINGTON (December 11, 2019) – A group of top economists arrived at a consensus 2020 economic and real estate forecast today at the National Association of Realtors®’ first-ever Real Estate Forecast Summit. The economists who gathered at NAR’s Washington, D.C. headquarters expect the U.S. economy to continue expanding next year while projecting real estate prices will rise and reiterating that a recession remains unlikely.

These economists predicted a 29% probability of a recession in 2020 with forecasted Gross Domestic Product growth of 2.0% in 2020 and 1.9% in 2021. The group expects an annual unemployment rate of 3.7% next year with a small rise to 3.9% in 2021.

When asked if the Federal Open Market Committee will change the federal funds rate in 2020, 69% of the economists said they expect no change, while 31% expect the committee will lower the rate next year.

The average annual 30-year fixed mortgage rates of 3.8% and 4.0% are expected for 2020 and 2021, respectively. Annual median home prices are forecasted to increase by 3.6% in 2020 and by 3.5% in 2021.

“Real estate is on firm ground with little chance of price declines,” said NAR’s Chief Economist Lawrence Yun. “However, in order for the market to be healthier, more supply is needed to assure home prices as well as rents do not consistently outgrow income gains.”

Apartment rents are expected to rise 3.8% and 3.6%, respectively, in 2020 and 2021. According to the group of economists, annual commercial real estate prices will climb 3.6% in 2020 and 3.4% in 2021.

“Residential and commercial real estate investment remains attractive as we approach the start of a new decade,” said NAR President Vince Malta, broker at Malta & Co., Inc., in San Francisco, CA. “Increased home building can serve as a stimulator for the overall economy, and we strongly encourage more homes to be built as buyer demand remains strong.”

The 2019 NAR Real Estate Forecast Summit consensus forecasts are compiled as averages of the responses of 14 leading economists who participated during the summit. The survey was conducted from December 2-5, 2019.

The National Association of Realtors® is America’s largest trade association, representing more than 1.4 million members involved in all aspects of the residential and commercial real estate industries.

# # #

Blog author image

Alicia Gantt

I have always had a passion and drive to help others. As a devoted wife and loving mother to two wonderful children, I know how busy life can get. To have the opportunity to become a Realtor has been ....

Latest Blog Posts

HOW YOU CAN FINANCE YOUR HOME RENOVATION

https://www.breakthroughbroker.com

Read More

Is the Real Estate Market headed toward Recession?

Will We See A U.S. Recession In 2020?Simon MooreSenior ContributorInvestingI show you how to save and invest.What are the chances that we'll see a recession in the U.S. in 2020? GETTY2019 was

Read More

Rich and Nutty, Chocolate Chubbies Cookies

This family favorite is super easy to make. We make them several times each year.Ingredients6 (1-ounce) semisweet chocolate squares, chopped 2 (1-ounce) unsweetened chocolate squares, chopped

Read More

Tips when Moving to A New State

10 Things to Consider Before Moving to a New StateFEBRUARY 8, 2018There are questions you should be asking yourself before moving to a new state to ensure that your next big move is the best choice

Read More