The National Association of REALTORS projected a modest decline in national median resale home prices for 2007. While national headlines emphasized the potential for the first broad based price drop since the Great Depression, the forecast itself suggested only a slight adjustment.
Historical Context
This article was originally published during the mid 2000s housing cycle transition. The projections below reflect national and local expectations during that period.
According to NAR Economist David Lereah, the national median existing home price was expected to slip 0.7% to $220,300 in 2007, following a 1.0% increase the previous year. Median new home prices were projected to rise 0.4% to $246,200 after gaining 1.8% in 2006. Modest growth was forecast for 2008, with existing home prices expected to rise 1.6% and new home prices 2.0%.
Lereah noted that median price shifts were partially influenced by changes in sales composition, with activity moving away from higher cost coastal markets toward more moderately priced regions.
National Headlines Versus Local Conditions
Although national media framed the forecast dramatically, the projected 0.7% adjustment represented a marginal shift at the national level. Inventories at that time remained below levels seen during the early 1990s housing downturn, and many markets were close to balanced supply conditions.
The Nashville real estate market was expected to outperform national averages during that cycle. Local projections at the time suggested potential appreciation in the 4% to 6% range across Middle Tennessee.
For broader context on how national trends translate into local pricing behavior, see our Nashville Housing Market Overview.
Submarket Performance Differences
Local submarkets often behave differently than national averages. For example, Brentwood recorded approximately 22% appreciation in 2006, significantly exceeding national trends. Strong prior appreciation can create natural price recalibration phases without signaling structural decline.
National median statistics reflect aggregate movement and may not fully capture neighborhood level variation.
