Home Price Expectations in 2013
According to a recent Zillow® sponsored survey by Pulsenomics® of 106 economists, real estate experts and investment and market strategists – most expect the Zillow Home Value Index to end 2013 up an average of 6.7 year-over-year before slowing down in 2014. This is an increase over the 5.4 percent annual increase predicted the last time the survey was conducted.
“Short-term expectations for home value appreciation through the end of this year are consistent with a nationwide housing market recovery that is both strengthening and widening, but still coping with high levels of negative equity, high demand and low inventory. Combined, these factors will continue putting upward pressure on home values for the next few months,” said Zillow Senior Economist Dr. Svenja Gudell.
2014-2017 Home Price Expectations
Panelists said they expected appreciation rates to slow to roughly 4.4 percent in 2014, on average, unchanged from the previous survey. This rate is expected to slow further to 3.6 percent, 3.5 percent and 3.4 percent in 2015, 2016 and 2017, respectively. Cumulatively, survey respondents predicted home values to rise 23.7 percent through 2017, on average, up from 22.3 percent in the last survey.
The Effect of Rising Mortgage Rates
88 percent of the panelists said that recent increases in mortgage rates do not pose a significant threat to the ongoing housing market recovery. Most agreed that mortgage interest rates would have to rise to at lease 6 percent to create a significant threat.
“Six percent is the minimum mortgage rate threshold that the most number of panelists view as a potential show-stopper for the recovery,” said Pulsenomics® founder Terry Loebs. “However, nobody should dismiss the implications for the housing market of the less popular view – held by 38 percent of our experts – that we are already flirting with a reversal of fortunes at or within about 100 basis points of prevailing mortgage rate levels.”
For more information read the full Zillow Home Price Expectation Survey press release here.
About Inlanta Mortgage
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