Reprinted from REALTOR® Magazine [June, 2010] with permission of the NATIONAL ASSOCIATION OF REALTORS®. printed in my July Newsletter, by Lawrence Yun, NAR Chief Economist:

“From my viewpoint, both home sales and home prices have reached the point of equilibrium. A slightly more tilt this or that way will naturally be at play always but the tilting will be not that eventful. Over the next five years, expect home sales to rise by about 2 percent annually. This growth rate is higher than the projected population or projected job growth rate. But part of the increase will come from a recovery in the second-home market. As for prices, do not expect any robust gains. At best home price appreciation will beat CPI inflation by one percentage point.

How will this impact the real estate industry? Based on these sales and price projections, the gross industry revenue from residential home sales will rise steadily. The industry revenue for last year is estimated at $49 billion, the lowest in eight years. I project $52 billion in 2010. Further increases are in the cards in the subsequent years with about $70 billion set for 2015. (These estimates are at the national level.) Still, revenue will be far short of the $85 billion generated during the frenzied and unsustainable period in 2005.”

It appears from Lawrence Yun’s housing market predictions, that the housing market should experience a slow, but steady increase in home price sales over the next five years.