The 'Stars Are Aligned for a Stellar Year': 2018 Housing Forecast

Charles C. Shinn Jr., founder of Builder Partnerships, has released his 2018 housing forecast, saying that the U.S. market is positioned for an exceptional year, citing significant pent-up demand, increasing household formation, extremely low inventory, and low mortgage rates.

According to Shinn, new home sales and new home construction will continue to grow, with single-family construction increasing between 10-12 percent, and new home sales rising by 10 percent. Existing home sales are likely to grow by about 3.5-4 percent, with median prices increasing about 6 percent to $260,000. The median price of new homes should increase about 5 percent to $335,500, says the Builder Partnerships report.

Housing closed out 2017 very strong. In fact, 2017 is tracking to be the strongest year in the housing recovery. Demand remains high, and most builders will start the year with a strong backlog. Inventory is low for both new and existing homes, and interest rates are still helping with affordability, although that bears watching as the Fed is predicted to raise interest rates three more times in 2018.

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