Veros found that while residential real estate appreciation trends continue to march up steadily, the previously rapid acceleration of values is starting to slow down. This insight is from the company’s VeroFORECAST real estate market forecast for the 12-month period ending December 31, 2014, updated quarterly and covering more than 1,000 counties, 345 metro areas, and 13,770 zip codes.
Veros’ future home price index (HPI) forecast indicates that, on average for the top 100 metro areas, Veros expects 5.1 percent appreciation over the next 12 months, up from last quarter’s 4.8 percent forecast. This is the sixth consecutive quarter where the index has shown forecast appreciation.
“The future HPI forecast continues to show good appreciation, but the markets appear to be topping out for now,” said Eric Fox, Veros’ vice president of statistical and economic modeling and author of VeroFORECAST. “The continued appreciation demonstrates the overall health of the real estate market, but it is important to note that this is just a slight increase from last quarter’s national forecast, indicating much slowing in the forecasted rate of increase. Currently, most areas in the country are expected to see price appreciation with few areas forecast to show declines.” Fox added that the split is slightly over 90% for markets with appreciation compared to a bit under 10% in depreciation.
“All markets in the Top 5 now have strong appreciation forecasts, although they are weaker overall than last quarter’s top markets, which topped at 15 percent. Moreover, although depreciating markets are still present, they are all exhibiting small depreciation trends such as -1% or -2%,” Fox noted.