Forecast Sees U.S. Real Estate Appreciation at 4.4% through Mid-2019
MBA NewsLink Staff
Veros Real Estate Solutions, Santa Ana, Calif., released its second quarter VeroFORECAST, which predicts over the next 12 months residential market values will appreciate at a national average of 4.4%, a slightly higher rate than previously forecast.
The report covers the 12 months from June 1, 2018 through June 1, 2019, using data from 1,005 counties, 354 metropolitan statistical areas and 13,877 zip codes that cover 82% of the U.S. population. It predicted overall home value appreciation for the 24th consecutive quarter.
The report reconfirms high demand for housing and historically low housing supply remain the key determinants of where any given market is expected to be on the appreciation-depreciation spectrum. The West dominated appreciation predictions, with Washington and Nevada occupying six of the 10 highest-appreciating metros in the U.S.; others are in California, Oregon and Idaho. In all 21 of the top 25 metros are in the West, led by Seattle (11.1 percent), Olympia, Wash. (9.8 percent), Bremerton, Wash. (9.8 percent), San Jose, Calif. (9.5 percent) and Carson, Nev. (9.5 percent).
"The San Jose market remains exceedingly strong with a supply of homes at an extremely low 1.0 months, while its population is continuing to grow steadily," said Eric Fox, Vice President of Statistical and Economic Modeling with Veros. "Its unemployment is an extremely low 2.6%. The Silicon Valley continues to attract workers for high tech jobs, and there isn't enough housing to fill demand, making this one of the strongest markets in the country."
Conversely, the report said metro areas predicted to depreciate or remain unchanged are largely in the Northeast. Nearly one-half of the bottom 25 markets are in New Jersey, Connecticut, New York, Maine, Pennsylvania and Maryland, with eight others in the Deep South: Louisiana, Alabama, Arkansas and Mississippi.
Cumberland, Md., is projected to be the worst-performing market, at -1.6 percent, followed by Farmington, N. Mex. (-1.1 percent), Gettysburg, Pa. (-1.0 percent), Atlantic City, N.J. (-1.0 percent) and Peoria, Ill. (-0.7 percent).