Urban Land Institute Predicts Steady Climb in Housing Through 2014

The latest forecast released by the ULI on March 28, predicts the next three years will produce a steady improvement in economic conditions for the U.S. with the real estate market benefiting from the breakthrough.

The ULI’s forecast consists of a survey of 38 expert real estate analysts and economists taken the month before the forecast is released. Dean Schwanke, the executive director of the ULI, describes the survey results as “fairly optimistic”. However, Schwanke did note in the explanatory webcast that there are risks and lingering concerns that could cause concern including changes in tax policy, the U.S. presidential election and Europe’s debt crisis.

Included in the webcast are three ULI leaders: Peter Linneman, chief executive officer of American Land Fund and principal of Linneman Associates; David Lynn, Clarion Partners managing director; and Kenneth Rosen, the chairman of Rosen Consulting Group.

Here’s an excerpt from the webcast regarding the single family home market:

The struggling housing sector is beginning to see a turnaround, with average home prices expected to stabilize in 2012, the survey said. Prices are forecast to increase by 2 percent in 2013 and by 3.5 percent in 2014. New construction starts, which were only 428,600 in 2011, are expected to increase steadily to 800,000 by 2014. Excess housing inventory is being absorbed, but “it’s market by market,” said Lynn. “There are some higher-performing areas, and we don’t really see this excess housing in New York, Boston, Seattle. It’s more the Southeast and Southwest,” he said.

The full article can be found at http://urbanland.uli.org/Articles/2012/Mar/MehaffyConsensus.