US Home Prices

US Home Prices

US Home Price Predictions

As we leave the Corona Virus shutdown period, we’re turning our attention to house price predictions and whether other buyers hot in the pursuit of homes for sale.

Most people want to see some home price forecasts to time their purchase or sale.  Are there going to be particular months where they can pull the buy or sell trigger? Corelogic is of the opinion that prices will climb in the next 3 months, then drop for perhaps the next 6 to 12 months.

 

The last few months have a lot of Americans (and Canadians, Brits and Aussies) pondering their work and personal lives.  There is so much uncertainty clouding housing demand and the economic forecast.  Americans are facing new questions about work, home buying, financing, safety, and opportunity.

Whether it’s resale homes or new homes, the economy is reawakening with fits and starts due to the pandemic.  Economists and stock market analysts talk about a V shaped recovery. Both resale and new home inventory is low, especially product in the starter home price category.

Demand and Liquidity Should Spur Home Buying

Improving economy + low inventory + first time buyer growth + low mortgage rates has to spell home price increases.  Sales of resale homes were still down in May yet sales volume is increasing. Many sellers are hesitant to sell right now with nowhere to go.  Buyers will have to pay more to get them to part with their precious property.

Prices were flat or rising slightly, and this is still a depressed economy with shutdowns continuing in effect.

There will be second wave of Covid 19 and it will make its effects felt, like it did today on the Dow, S&P and NASDAQ today. Yet buyers show an enthusiasm and demand for moving into roomier, more rural location.  Experts are underestimating this.

Prices During May

Screenshot courtesy of Clear Capital.

Fastest home price appreciation in Philadelphia, San Jose, and Nashville.

Screenshot courtesy of Clear Capital

Case Shiller Price Forecasts

Case Shiller offers a negative outlook for home prices. They believe home prices will lift a little in June/July/August and then head downward.

This chart depicts a fairly decided downward trend.

Home price forecast to 2021. Screenshot courtesy of Corelogic.

There is a big migration out of the cities to the burbs and smaller towns. This is likely to take some of the pressure off of apartments, condos and other high density housing.  Yet, single family and other lower density homes should still draw buyers.

 

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In the burbs and outlying towns, particularly in the midwest, we could see bidding wars.

As you can see, home prices in the major metros were doing well.  These are price growth numbers from the last 12 months including the last very difficult three months.

Home price growth last 12 months. Screenshot courtesy of Corelogic.

The Migration out of Cities

People are becoming more mobile as high home costs push them out of congested, high priced urban areas to more affordable regions. The new work at home mandate means workers don’t have to be chained to their employer’s physical office location.  And employers too may abandon urban sites for new locations in America’s heartland. They’re looking for the best cities to buy real estate.

Case Shiller Home Price History Chart

The housing experts need to take another look at this chart. Even through the worst mini-recession ever, home prices keep rising. This upward direction shows no quit.

Home Price History

Home Price History. Chart courtesy of St Louis Fed.

Home prices have been on the rise in May too.  NAR reported a 3.1% rise just in the last two weeks of May. We’ll have to wait for the full set of sales and home price report out in a few weeks.

House prices rose 5.4% in April, up from 4.5% rise in March. Clearly, the trend is upward and as home buyers slowly go back to work, the price pressure will rise.

HPI Price Index Chart Courtesy of Corelogic

Is this the best time to buy a home? Will buyers get a break later on in 2020 if they wait? Is this a buyers market? It just may be the right time as the forecast is a return of price growth after the current slowdown.

Can you assess a housing market without looking at:

  1. economic predictions,
  2. consumer confidence
  3. wages and employment
  4. GDP and trade deficits
  5. work at home trends
  6. fears of disease in high density regions, going forward
  7. stock market predictions?

 

Check the health and predictions for major cities: Los AngelesNew YorkSeattleChicagoPhiladelphiaSan DiegoMiamiBostonBay AreaSacramento, and Atlanta. See forecasts for California housing and Florida housing markets.

Reuters polled a number of housing market analysts at the end of a weak month in home sales, and this is still what they believe going forward to 2021:

A look back at how right they were about home price rises. With the cessation of the Corona Virus, the demand for homes will resume.

This reuters poll reflects the belief in rising home prices.

Screenshot courtesy of CNBC

Freddie Mac Forecast

Freddie Mac points to higher mortgage rates until they throttle the economy in 2020. If the economic forecast is dire, then interest rates would fall. Higher rates would serve to raise home prices, if the economy hangs in there.

Mortgage Rates. Screenshot courtesy of Freddie Mac.

 

Forisk forecasts solid levels of home construction peaking in 2023 and sustained to 2027, although tailing due to satiated demand and rising interest rates.

 

And from a reuters news report on the economy, Joel Naroff, chief economist at Naroff Economic Advisers is quoted as saying, “Everything seems to be moving in the right direction in the economy … The weak links are recovering and the strengths are staying strong. The Fed is not going to continue doing nothing.”  That would mean he expects the Fed to raise interest rates, and that would push the US dollar to further highs.

Best Cities to Invest?

Cross reference this compiled list of cities with a previous post on best cities to buy property.

For rental income, Silicon Valley, Los Angeles, Dallas, San Diego, and Boston might be best picks. It might be a case of the usual suspects, but start here, work your way to the best zip codes and neighborhoods, types of house, employment growth, and migration patterns of Millennials, and you may have yourself a winner (real estate investment). Who knows which cities will rule after 4 years of the Trump overhaul of the US government and US economy?

Top Home Price Growth Trends

Price growth varies each quarter. These are the latest prices from Kiplinger. California cities come in as the least affordable in the nation. New York, Washington DC, Honolulu, and Seattle are right up there.

Rank City (updated Jan 2019) Price Rise over last year Sales Growth Average Home Price 2015 – Kiplinger
1 San Francisco-Oakland-Hayward, CA 8.41% 1.17% $750,000
2 San Jose-Sunnyvale-Santa Clara, CA 8.26% 1.26% $1,000,000
3 Seattle-Tacoma-Bellevue, WA 7.36% 3.41% $417,000
4 Sacramento–Roseville–Arden-Arcade, CA 7.18% 4.92% $305,000
5 Los Angeles-Long Beach-Anaheim, CA 6.90% 6.03% $605,000
6 Salt Lake City, UT 6.66% 4.67% $301,000
7 Portland-OR-Vancouver-WA 6.55% 5.02% $305,000
8 San Diego County, CA 6.47% 4.89% $530,000
9 Denver CO 6.41% 3.96% $360,000
10 Providence-RI Warwick, MA 6.31% 4.09% $246,000
11 Stockton-Lodi, CA 6.12% 4.01% $312,000
12 Tucson, AZ 6.10% 5.47% $179,000
13 Boston-Cambridge-Newton, MA 6.09% 6.32% $398,000
14 Phoenix-Mesa-Scottsdale, AZ 5.94% 7.24% $240,000
15 Atlanta-Sandy Springs-Roswell, GA 5.93% 2.67% $190,000
16 Grand Rapids-Wyoming, MI 5.77% 4.16% $155,000
17 Orlando-Kissimmee-Sanford, FL. 5.69% 6.10% $205,000
18 Philadelphia, PA 5.54% 3.08% $190,000
19 Greensboro-High Point, NC 5.50% 3.56% $118,000
20 Bakersfield, CA 5.26% 4.49% $199,000
21 Oxnard-Thousand Oaks-Ventura, CA 5.19% 5.35% $565,000
22 Richmond, VA 5.18% 2.57% $200,000
23 Detroit-Warren-Dearborn, MI 5.17% 6.22% $145,000
24 Provo-Orem, UT 5.16% 5.84% $250,500
25 Las Vegas-Henderson-Paradise, NV 5.06% 4.57% $240,000
26 Greenville-Anderson-Mauldin, SC 5.03% 3.61% $170,000
27 Sarasota-Bradenton, FL 5.00% 5.37% $192,000
28 Riverside-San Bernardino-Ontario, CA 4.98% 6.88% $276,000
29 Tulsa, OK 4.90% 4.01% $150,000
30 Harrisburg-Carlisle, PA 4.87% 3.11% $162,500
31 Nashville, TN 4.86% 4.41% $234,000
32 Tampa-St. Petes, FL 4.84% 5.10% $176,000
33 Palm Bay-Melbourne-Titusville, FL 4.83% 3.14% $160,000
34 Spokane, WA 4.81% 3.95%
35 Jacksonville, FL 4.79% 7.03% $170,000
36 Boise City, ID 4.79% 5.28% $215,000
37 Colorado Springs, CO 4.77% 6.71% $260,000
38 Akron, OH 4.76% 1.90% $125,000
39 Youngstown-Warren-Boardman, OH 4.75% 1.89% $75,000
40 Springfield, MA 4.74% 5.13% $195,000
41 Toledo, OH 4.72% 2.07% $106,000
42 Hartford, CT 4.68% 0.42% $201,000
43 Milwaukee, WI 4.65% 4.53% $192,000
44 Lakeland-Winter Haven, FL 4.64% 4.89% $146,000
45 Honolulu, HA 4.55% 3.76% $530,000
46 Virginia Beach-Norfolk,NC 4.44% 3.76% $215,000
47 New Haven-Milford, CT 4.39% 2.60% $117,000
48 Kansas City, MO KS 4.36% 2.66%
49 Charlotte, NC 4.32% 6.28% $138,000
50 Augusta-Richmond County, GA 4.28% 4.62% $147,000
51 Dayton, OH 4.25% 2.18% $115,000
52 Birmingham-Hoover, AL 4.23% 4.29% $131,000
53 Raleigh, NC 4.16% 7.55% $238,000
54 Pittsburgh, PA 4.13% 6.08% $125,000
55 Dallas-Fort Worth-Arlington, TX 4.13% 5.09% $182,000
56 Minneapolis-St Paul, MN 4.08% 3.56% $235,000
57 Oklahoma City, OK 4.07% 4.18% $155,000
58 Houston, TX 4.01% 6.08% $170,000
59 New York-Newark-Jersey City, NY N.J Pa. 3.99% 6.48% $425,000
60 Miami-Fort Lauderdale-West Palm Beach, Fla. 3.98% 4.17% $240,000
61 New Orleans-Metairie, LA 3.95% 5.94% $190,000
62 Ogden-Clearfield, UT 3.94% 4.02% $211,000
63 El Paso, TX 3.93% 2.85%
64 Washington-Arlington-Alexandria, DC VA 3.92% 4.60% $375,000
65 Wichita, KS 3.89% 2.51%
66 Memphis, TN 3.80% 4.22% $137,700
67 Columbus, OH 3.78% 5.70% $170,000
68 Madison, WI. 3.75% 5.40% $245,000
69 Indianapolis, IN 3.72% 5.03% $114,450
70 Omaha, NB 3.70% 4.64% $175,000
71 Fresno, CA 3.65% 5.82% $233,000
72 Albuquerque, NM 3.62% 4.13% $129,000
73 McAllen-Edinburg-Mission, TX 3.57% 5.11% $118,000
74 Cleveland, OH 3.56% 4.69% $135,000
75 Austin-Round Rock, TX 3.50% 7.40% $251,000
76 St. Louis, Mo 3.46% 4.35% $155,000
77 Worcester, MA 3.45% 4.97% $225,000
78 Syracuse, NY 3.41% 2.55% $106,000
79 Columbia, SC 3.39% 3.56% $133,000
80 Buffalo- Niagara Falls, NY 3.36% 2.08% $125,000
81 San Antonio-New Braunfels, TX 3.29% 6.22% $170,000
82 Charleston, SC 3.27% 6.09% $238,000
83 Louisville, KY 3.24% 4.69% $165,000
84 Cincinnati, OH 3.18% 6.38% $150,000
85 Knoxville, TN 3.11% 6.27% $141,000
86 Deltona-Daytona Beach, FL 3.10% 8.23% $170,000
87 Rochester, NY 3.09% 6.27% $127,000
88 Allentown, PA 3.07% 3.00% $175,000
89 Little Rock, AK 2.97% 3.59% $140,000
90 Baltimore-Columbia-Towson, MD 2.97% 2.88% $238,000
91 Des Moines, IA 2.92% 4.32% $173,000
92 Cape Coral-Fort Myers, FL 2.91% 5.41% $200,000
93 Baton Rouge, LA 2.87% 5.53% $166,000
94 Winston-Salem, NC 2.66% 5.08% $137,000
95 Durham-Chapel Hill, NC 2.55% 8.95% $220,000
96 Scranton–Wilkes-Barre, PA 2.40% 6.62% $80,000
97 Jackson, MI 1.98% 9.44%
98 Chicago, IL 1.95% 2.27% $218,000
99 Bridgeport-Stamford-Norwalk, CT 1.92% 2.56% $365,000
100 Albany-Schenectady-Troy, NY 1.78% 3.51% $172,000
Chart Data courtesy of Realtor.com and Kiplinger.com

US Real Estate Market to 2021

Please see the major metro market reports for 2021 and beyond including Denver, DallasAtlanta, Chicago, San Francisco, Houston, Tampa, New York, Los Angeles, San Diego, Seattle, and Philadelphia.

Is 2020 the right year to buy rental income property?  What are the best investments in 2020 including investing in real estate?

Bookmark this page and return for further forecasts, predictions and market data for most major US cities including  Los Angeles, New York City, San Diego, San Francisco, Houston, Miami, Phoenix, Denver, Seattle, Chicago, Boston, Tampa, Charlotte, Orlando, Toronto, Vancouver, Newmarket/Aurora, Richmond Hill, Vaughan, Mississauga, Anaheim, Beverly Hills, Malibu,  San Jose, Fresno, Santa Clara, Sacramento, Mountainview, Palo Alto, Portland, Washington, Atlanta, Irvine, Nashville, Sunnyvale, Salt Lake City, Riverside, Rancho Cucamonga, Costa Mesa, Raleigh, Albuquerque, Glendale, Oceanside, Long Beach, Huntington Beach, Carlsbad, Santa Clarita,  Henderson, and more.

22 years of experience as a content researcher, strategist and SEO expert for marketing agencies and his own company. Gord's investigation into housing markets, stock markets, and AI marketing strategy helps clients achieve market dominance. Some of Gord's blog posts have achieved half a million pageviews with over 7,000 social media shares, revealing Gord Collins special talents for building reach and impact. Visit the AI Marketing website for an introduction to the AI marketing era. Artificial Intelligence is lending extra benefit to the power of marketing software which is enhancing SEO, Copywriting and Sales. Gord offers a new brand of SEO services and to regain his reputation as a leading SEO expert. See his 2nd book which describes the powerful relationship between SEO and Content Strategy. Gord's passion is researching algorithms, trends, forecasts, and market statistics to establish clients at the top.

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