Veros Real Estate Solutions announced that Q4 2019 VeroFORECAST data indicates an average projected appreciation rate for residential real estate in the nation’s largest 100 housing markets of 3.9 percent for the year ending Dec. 31, 2020.
This forecast is slightly higher than the rate predicted in the first three quarters of 2019, closing the year with moderate home-price growth, Veros announced in a press release.
“The sound fundamentals of the economy, low interest rates and strong levels of employment should result in moderate home-price appreciation with very few geographic pockets of weakness,” Eric Fox, Veros vice president of Statistical and Economic Modeling, said in the release
The 10 markets forecasted to increase the most between Q4 2019 and Q4 2020 primarily are located in the Pacific Northwest (Washington, Oregon and Idaho) and the West (Arizona and Utah), with one outlier in Georgia.
The defining factor in the strongest markets is a very low housing supply, which is forcing prices to increase much more rapidly than in other markets, Veros stated.
The Q4 2019 VeroFORECAST 10 strongest markets were Spokane, Wash., (10.1 percent); Boise City-Nampa, Idaho, (9.5 percent); Idaho Falls, Idaho, (8.4 percent); Longview, Wash.,. (8.2 percent); Kennewick-Pasco-Richland, Wash.;, (8 percent); Phoenix-Mesa-Glendale, Ariz., (7.1 percent); Gainesville, Ga., (6.9 percent); Eugene-Springfield, Ore., (6.7 percent); Provo-Orem, Utah, (6.7 percent); and Olympia, Wash.,. (6.5 percent).
Markets with depreciation are almost non-existent compared with previous quarters. According to the VeroFORECAST for Q4 2020, only Monroe, La., is expected to decline.
In this quarter, it appears that the $10K-cap on the state and local tax deduction (SALT) has softened markets where these taxes are high and growth is stagnant, such as New York, New Jersey and Connecticut. California continues to struggle compared with years when home prices there were growing by double-digit percentages year-over-year, Veros said.
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