NAR Chief Economist Lawrence Yun Forecasts Existing Home Sales Will Rise by 13.5% Next Year

ANAHEIM, Calif. (November 15, 2023) – Elevated mortgage rates, high home prices and limited housing inventory are making the dream of homeownership difficult for Americans, according to NAR Chief Economist Lawrence Yun.

He explained that high mortgage rates and low inventory have dominated 2023, saying, "Twenty-year-high mortgage rates have held off home buyers. There's also a lack of housing inventory to sell, which means fewer opportunities for sales in the marketplace.”

Yun said that home sales will likely decline by 18% this year, compounding a 17% reduction last year.

Driven by extraordinarily high interest rates, 30-year-fixed mortgage rates remained elevated in 2023, climbing to as much as 8%.

"The 10-year Treasury yield is at 4.4%, which historically means mortgage rates could be at 6.4%, but they are much higher," said Yun. "The bond market is forcing the Fed to pivot.”

Yun forecasts that interest rates will drop to between 6-7% by the spring buying season and anticipates that more sellers will enter the market.

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