U.S. home prices will increase an average of 4.5% over the next 12 months, according to Veros Real Estate Solutions’ quarterly VeroFORECAST report.
The third quarter marks the 25th consecutive quarter that Veros has forecast higher home price appreciation over the next year.
“We are forecasting that the overwhelming number of metros across the nation, approximately 97 percent, will appreciate, with just three percent depreciating during this period,” says Eric Fox, vice president of statistical and economic modeling at Veros, in a statement. “The fact that these averages are identical to those of last quarter’s update indicates that we are seeing consistency in nearly every metro market.”
Home price growth will continue to be strongest in the Western states, according to the report, which covers the top 100 largest metropolitan areas.
In fact, seven of the Top 10 metros are in Washington and Nevada.
Bremerton-Silverdale, Wash., leads the pack with 11.7% projected home price appreciation.
It is followed by Boise City-Nampa, Idaho, at 11.2%; Las Vegas-Paradise, Nev. at 10.8%; Bellingham, Wash., at 10.6%; and Olympia, Wash. at 10.3%.
Other top performing states will include California, Colorado and Utah.
“This is a very strong showing, with the average appreciation of the Top 10 markets forecast to be a half-percentage point higher than in our last report,” Fox says.
Fox points out that inventory levels play a role in determining which MSAs have the greatest viability for price growth.
“Housing supply is a key discriminator between the forecasted top- and bottom-performing markets,” he says. “Where the housing supply is very low, as in our top markets, prices are expected to increase significantly. By contrast, for many of the bottom markets, which are in very slow growth metros, housing supply is projected to remain high.”