FORECAST POINTS TO STEADY PRICE GROWTH LED BY CALIFORNIA

When it comes to price appreciation, California markets are expected to continue leading growth over the next year, while certain areas concentrated in the Northeast should see a decline in home values, according to Veros Real Estate Solutions’ most recent forecast ending June 1, 2014.

The company’s forecast covers 969 counties, 324 metro areas, and 13,502 zip codes.

In the next 12 months, Veros projects San Francisco will come out ahead with a 12.7 percent increase.

The predictive technology software company described San Francisco as having a “serious housing shortage,” combined with “historically good affordability” and a lower unemployment rate of 6.7 percent compared to the national average of 7.6 percent as of May.

Other metros in the top five for price appreciation are Los Angeles (+11.6 percent), San Jose (+11.1 percent), Midland, Texas (+11.1 percent), and Phoenix (+10.9 percent).

Veros also noted Florida, Washington, Colorado, North Dakota, and Idaho also appear strong.

On the other hand, markets in New York, Connecticut, and New Jersey are expected to see a weakening in prices.

Two New York markets are projected to see the biggest declines in the next year: Poughkeepsie (-2.9 percent), and Kingston (-2.1 percent).

The remaining three metros in the bottom five were Norwich, Connecticut (-1.9 percent); Bridgeport, Connecticut (-1.8 percent); and Atlantic City, New Jersey (-1.6 percent).

Outside of those three states, areas in Mississippi, Alabama, and South Carolina should also see poor performance.

Among the top 100 markets, Veros’ home price index (HPI) projects a 3.1 percent increase, marking the fourth straight quarterly gain. Veros also added nearly 90 percent of U.S. markets covered should see a bump in prices, up from 75 percent in the previous quarter.

“It’s encouraging to see steadily rising appreciation expectations,” said Eric P. Fox, VP of statistical and economic modeling for Veros. “What we are seeing now indicates a return to a healthy market with improvements appearing in a conservative yet correcting manner.”
DSNews.com
Esther Cho
6/28/13