Report Projects Above-Normal Price Growth, Strong Metro Area Gains

Forty-five of the top 50 metropolitan markets will experience yearly price increases during the second half of the year, according to Clear Capital’s Home Data Index Market Reportreleased Tuesday.

This widespread forecast of price increases “speaks to this move toward a more balanced, broad-based recovery,” said Alex Villacorta, VP of research and analytics at Clear Capital.

Bakersfield, California, is expected to lead national price gains with a 5.2 percent price increase through the end of this year.

Las Vegas comes in as a close second in Clear Capital’s forecast with a projected price growth of 5 percent. Las Vegas posted the highest quarterly price gain in the second quarter—an increase of 4.4 percent.

The Bakersfield metro posted a notable jump from 29th place in Clear Capital’s first-quarter report to first place in the second quarter report.

“This leap is an example of the fundamentals driving the overall recovery, Clear Capital said, adding also that Bakersfield “serves as a reminder that the recovery continues to unfold market by market.”

After, Bakersfield and Las Vegas, the top five metros for projected price gains through the end of the year are rounded out by Chicago; Sacramento, California; and Milwaukee, Wisconsin, with gains of 4.9 percent, 4.8 percent, and 4.4 percent, respectively.

Clear Capital expects the Cleveland metro to fare the worst for the remainder of the year with a 2.2 percent price decline.

Raleigh, North Carolina; Charlotte, North Carolina; and Denver, Colorado, are the only other metros out of the top 50 with anticipated price depreciations over the remainder of the year, according to Clear Capital. However, the analytics firm expects price decreases of less than 0.5 percent in each.

“At the metro level, we saw some subtle, yet notable trends unfold in June,” Villacorta said. “While price trends continued to diverge at the micro market level, they are for the most part positive.

At a national level, Clear Capital revised its 2.6 percent projected price gain over the year this year up to 6 percent. While lower than the current yearly gain of 8.6 percent, this forecast is still greater than historical norms, which rank between 4 and 5 percent.

While it is notable that some markets are experiencing double-digit gains, “[s]eeing the bulk of major metros move into positive territory is truly good news, even if their gains are still in the single digits,” Villacorta said.

DSNews.com
Krista Franks Brock  7/2/13