What Are Experts Saying About Home Prices

Dated: 07/22/2020

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Last week, a very well-respected real estate analytics firm surprised many with their home price projection for the next twelve months. CoreLogic, in their latest Home Price Index said:

“The economic downturn that started in March 2020 is predicted to cause a 6.6% drop in the HPI by May 2021, which would be the first decrease in annual home prices in over 9 years.”

The forecast was surprising as it was strikingly different than any other projection by major analysts. Six of the other eight forecasts call for appreciation, and the two who project depreciation indicate it will be one percent or less. Here is a graph showing all of the projections:What Are Experts Saying about Home Prices? | Keeping Current MattersThere’s a simple formula to determine the future price of any item: calculate the supply of that item in ratio to the demand for that item. In housing right now, demand far exceeds supply. Last week mortgage applications to buy a home were 33% higher than they were at the same time last year. The available inventory of homes for sale is 31% lower than it was last year. Normally, these numbers should call for homes to continue to appreciate.

Bottom Line

Because of the uncertainty with the pandemic, any economic prediction is extremely difficult. However, looking at the limited supply of homes for sale and the tremendous demand for housing, it is difficult to disagree with the majority of analysts who are calling for price appreciation.

Source: Keeping Current Matters.

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Jane Skulstad

Welcome! As a REALTOR® and SRES® - Seniors Real Estate Specialist affiliated with HomeSmart Elite and the Valley Solutions Team, I am here to help you buy, sell or invest in Real Estate. I can al....

1 comments in this topic

  • Posted by James Haskin
    08/02/2020
    We are thinking of selling our home \r\nand buying a smaller unit. Either a one story town house or possibly a double wide mobile (2 or 3 bdrm)., 1000sf\'- 1200sf.. We are in our 80\'s and we have a disabled son (56). so we don\'t want 2 level. Please respond. Thank You\r\n

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