As everyone tries to guess where the market is going, we wanted to share some information from a recent publication as well as the thoughts of our listing specialist, Sandy Erickson.
Here is the summary of the press release in the latest edition of the Home Price Expectations Survey that has just been published.
- Among the more than 100 experts surveyed in the Zillow Home Price Expectations Survey, a majority said they don’t expect the housing market to normalize for at least three more years.
- More than 100 expert panelists predict that U.S. home values will end 2014 up an average of 4.8 percent from 2013, to a median value of $176,760.
- On average, respondents said they expect home values to exceed their pre-recession peak in February 2018.
- In the longer term, respondents are most concerned by low household formation rates, would-be first-time buyers in a weak financial position and demographic changes that are affecting the housing market.
Sandy Erickson’s professional summary:
- After 6 years of strong depreciation (30-40% from 2006 to 2012), we experienced 18-24 months of strong appreciation (15%+ from 2012-fall of 2014) and are in a market now where the appreciation is leveling off to be what everyone use to consider “normal appreciation”…around 4%. I think that is great news! Who wants to experience double digit increases if it means we have to lose in the double digits as well?! Have we all gained back what we have lost? NO. According to the general statistics in this article, we need a few more years to get there…I agree with that on average in the Twin Cities area. Certainly some areas did better and some did worse during the down turn, but on average we are not yet back to pre-recession values. However, if a seller is buying right after their sale then the house they are buying is in the same market so it’s all relative anyway!
- It’s a great time to be selling or buying a home right now! Homes priced right and that show well are still selling in a short amount of time. Home prices and interest rates are still lower than they could be for buyers. Inventory will likely start to “go on sale” as sellers and realtors realize that appreciation is normalizing.
- After 8 years of craziness, this is no market to complain about for either a buyer or a seller! And, who knows what the future really holds…could be better next year, could be the same, and could be worse. You can’t time any market perfectly because you don’t know exactly where you are at in it until it is behind us. The best time always to sell or buy is when you are personally ready!
Thanks for taking the time to understand the market.