Economists Expect Big Year For New Home Market

A panel of economists participating in an event sponsored by the National Association of Home Builders said they expect 2015 to be a good year for single-family housing production. A combination of favorable mortgage rates, a growing economy, improved job creation, and pent-up demand is expected to boost the number of new homes being built and sold in the next year. Mark Zandi, chief economist at Moody’s Analytics, said job growth is the chief reason for the optimistic forecast. According to Zandi, with 225,000 jobs created each month, unemployment should continue to decline, improving conditions for the housing market and releasing pent-up demand for new homes. In fact, he believes that current new home construction won’t be enough to keep up with rising demand over the long term. Nationwide, housing production fell to its lowest level in early 2009, hitting just 27 percent of normal activity. According to the NAHB’s outlook, it should be at 68 percent of normal by the end of 2015 and at 90 percent of normal by the end of 2016. More here.

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