According to a new forecast of nationwide residential real estate values predicts significant slowing in most markets through 2019. The 2018 VeroFORECAST is the latest 12-month forecast from Veros Real EstateSolutions (Veros), an award-winning industry leader in enterprise risk management, collateral valuation services and predictive analytics.
The new report forecasts average appreciation of 3.9 percent in the survey’s 100 most populous markets, which is more than a half-percent drop from the 4.5 percent average of the top 100 markets in the previous quarterly report released last September.
The drop is reflected throughout the latest report’s projections, which are based on data from 359 Metropolitan Statistical Areas (MSAs). These MSAs include 13,870 zip codes and 1,004 counties for a total coverage of the residences of 82 percent of the U.S.population.
“This amount of change from one quarter to the next is significant,” said Eric Fox, VP of Statistical and Economic Modeling at Veros and the report’s author. “While the market fundamentals remain solid and we still expect the overall housing market to remain healthy, there is a definite slowing down of most markets from last quarter’supdate.”
“Wedonotseeacrash,”Foxcautioned,”butsimplyaslowingdownasthestrengthofthepastfewyearsisexpectedto dissipate somewhat in mostmarkets.”
With the economy strong and unemployment continuing to drop, the report points to housing supply and interest rates as the key contributors to the softening.”Overall, interest rates appear to be softening the forecasts in many markets by one-to-two percent over what they wouldhavebeen hadtheflatinterestrateenvironmentcontinuedasithasforthepastseveralyears,”Foxsaid.”Atthe same time, housing supply is a key discriminator between our top and bottom forecast performingmarkets.”