According to a recent report issued by the National Association of Realtors, the upward trend currently being experienced by the housing market is expected to continue through the end of 2012.
"If we just hold at the first-quarter sales pace of 5.1 million, sales this year would rise 4 percent, but the remainder of the year looks better," said NAR chief economist Lawrence Yun. "We expect 5.3 million existing-home sales this year, up from 4.9 million in 2010, with additional gains in 2012 to about 5.6 million - that's a sustainable level given the size of our population."
Mortgage rates are expected to rise to 5.5 percent by the end of 2012, when they will average 6 percent.
Yun also relayed that the number cash sales, as well as the stock market's recovery, highlight that real estate investments are still tops among most consumers. Thus, this should create pent-up demand, which would then translate into more mortgages and more home sales for those seeking relocation.
Overall, Yun predicted that the Gross Domestic Product will reach 2.5 percent during 2011 and 2.7 percent in 2012, with an additional 1.2 million to 2 million jobs becoming available during this stretch. With the unemployment rate falling - Yun estimates it will decline to 8.6 percent by the end of 2012 - more consumers could begin spending on real estate.