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Home prices will continue to rise through 2023, although more slowly than 2020’s 11.4-percent peak pace, according to an Urban Land Institute (ULI) survey this month of 42 economists at 39 real estate organizations.
Prices will inflate by 8.1 percent this year, 5 percent in 2022, and 4 percent in 2023, bringing the rate slightly below the 20-year U.S. average but still outpacing inflation in other sectors, the economists predicted.
New housing starts will total 1.1 million this year and 1.2 million in each of the next two years, exceeding the 20-year average of 942,000, the survey found, but those figures still may not be enough: about 1.3 million new households will form annually through 2024, according to Goldman Sachs.
Also, homebuilders continue to face several obstacles, including short supplies of lumber and other materials, rising mortgage rates, and, not least, a shortage of available building lots.
The New Home Lot Supply Index showed a record shortage of lots available to put new homes on, analysis firm Zonda reported.
TREND FORECAST: Again, we have long forecast the rise in residential real estate when the COVID War was launched in March 2020. In addition, even when interest rates rise and the “Greatest Depression” worsens, while home prices will decline, in markets where they have risen the most, prices will not fall below this year’s price level.