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Weekly economic review & outlook A housing market surge for 2020

January 25, 2021

You Need to Know

Week in review

Existing home sales up again for December

Capping off a strong 2020, existing home sales rose to 6.76 million units – the second highest monthly reading since 2006.

Builders continue to increase construction

Responding to surging demand, housing starts increased by 5.8 percent for December, focused on single-family units.

Week Ahead

Forecasts

Strong growth in real GDP expected for Q4

Strong momentum from a record-setting Q3 is expected to lead to solid growth for Q4, despite growing weakness in November and December as COVID-19 cases spiked.

Rebound likely for new home sales

Demand factors remain very positive for home sales, and with a lack of existing homes for sale, new sales should rebound in December following a surprising decline in November.

Housing activity ended 2020 on a positive note. Existing home sales rose by 0.7 percent for December to an annualized pace of 6.76 million — trailing only October as the fastest month in nearly 15 years. For all of 2020, there were 5.64 million existing sales (also the most since 2006) as record low mortgage rates, the improving job market, and a desire for “space” driven by the pandemic boosted sales despite the sharp economic downturn earlier in the year.

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