U.S. home prices will turn negative overall and depreciate on average by -0.5% in 2023, according to Veros Real Estate Solutions‘ VeroFORECAST report.
If the forecast holds true, it would be the first time in more than a decade that it has gone negative.
“This decrease to an average depreciation of -0.5 percent over the next 12 months is the first time in over a decade that Veros’ average house price forecast has gone negative,” says Eric Fox, chief economist at Veros, in a statement. “The last time that the annual forecast was expected to be negative was in 2012 following the aftermath of the previous housing market crash.
“Though average depreciation is expected now, the fundamentals of the U.S. housing market in 2023 are much better than they were a decade ago,” Fox adds. “This is not going to be a repeat of what we saw in 2007-2008.”
Veros predicts that the rate of depreciation will be gradual.
“Interestingly, many markets which were the big housing market winners of the past year or two are now forecast to be some of the worst-performers including San Francisco, Seattle, Austin, Boise, San Jose, and Las Vegas,” Fox says. “These markets are all expecting depreciation over the next 12 months which will range from -5 percent to -7 percent.”
The report evaluates home prices in more than 300 of the nation’s largest housing markets.
Photo: Kostiantyn Li
