According to the National Association of Realtors (NAR), new home sales are expected to rise 11% to 750,000 in 2020. This would be the highest reading since 2007. In addition, the sales of existing homes are expected to rise to 3.7% to 5.56 million in 2020, the highest level since 2017. The age group that continues to be the driving force behind the housing market is the Millennial Generation. Data from Realtor.com reports that Millennials made up a staggering 46% of all mortgage originations in September, up 3% from the previous year.
In addition to expected home sale increases in 2020, the median home price of an existing home is expected to increase as well. Lawrence Yun, chief economist of the NAR expects the median price to be $270,400 next year, rising 4.3% from 2019. Low interest rates and high demand are two of main factors that are expected to be the catalyst to rising home values.