New Home SalesCENSUS
613K
U.S. Housing Market · 2017
U.S. Housing Market in 2017
Existing SalesNAR
5.51M
Median PriceNAR
$248,800
30Y MortgagePMMS
3.99%
In 2017, the U.S. housing market recorded existing-home sales averaged 5.51 million, new-construction sales of 613K, and a 30-year fixed mortgage rate of 3.99%.
Existing-home sales rose 1.1% from 2016. the median existing-home price rose 5.6% to $248,800. the 30-year fixed mortgage rose 0.34 percentage points to 3.99%.
By the numbers — 2017: new-home sales 613K, existing-home sales 5.51M, median existing price $248,800, 30-year mortgage rate 3.99%.
Macroeconomic Context
The Trump administration's first year in office brought an energized business climate and a significant legislative achievement: the Tax Cuts and Jobs Act, signed into law in December 2017. The legislation cut the corporate tax rate from 35 to 21 percent, reduced individual income tax rates, nearly doubled the standard deduction, and capped the state and local tax (SALT) deduction at $10,000. For housing specifically, the SALT cap reduced the after-tax benefit of homeownership for residents of high-tax states — New York, New Jersey, California, and Illinois — creating a headwind for their housing markets that would play out over subsequent years. The mortgage interest deduction was retained but limited to loans up to $750,000 rather than $1,000,000.
GDP grew approximately 2.3 percent, business investment accelerated, and consumer confidence was elevated. Unemployment fell to 4.1 percent by October. Consumer price inflation averaged about 2.1 percent. The Federal Reserve, led by Chair Janet Yellen, raised rates three times during the year, ending 2017 with a federal funds rate of 1.25 to 1.50 percent.
Thirty-year mortgage rates averaged roughly 4.0 percent for the year — essentially unchanged from 2016's average despite the post-election spike that had ended the prior year. Housing remained a broadly stable environment: solid demand, tight inventory, and modest rate increases produced healthy if unspectacular price appreciation. Hurricanes Harvey, Irma, and Maria caused catastrophic damage in Texas, Florida, and Puerto Rico, disrupting local housing markets but creating reconstruction demand that supported broader construction employment.