The National Association of Realtors projected today that prices for existing homes will drop 0.7 percent this year, the first median price drop forecast since the group began keeping records in the late 1960s. The decrease compares with an increase of 1.8 percent in 2006. The group also projects a slight decline in existing home sales to 6.34 million from 6.48 million in 2006 and new home sales are expected to decline to 904,000 from 1.05 million last year. “As home sales moderate, overall home prices will be essentially flat this year,” said David Lereah, chief economist for the NAR. “The good news is that inventories remain well below the levels experienced during the last housing downturn in the early 1990s and supplies are close to balance in many areas.”
