Wondering What the Future Holds in Home Prices?

What the Future Holds for Homesales

As a buyer or seller, you may be wondering what the future holds for your home. Will prices continue to rise with time and eventually surpass their all-time high? Or should we expect them fall back down again soon after reaching such highs in 2016?
A few terms that could help shed light on this issue include:

Appreciation (an increase)

Depreciation(a decrease)

Acceleration/deceleration when something happens more quickly than expected  

So don't worry!

Home prices have increased for 114 straight months with no signs of slowing. But how long will this trend last? Experts are split on whether or not the market will see some slight deceleration, but they all agree that any depreciation into negative territory isn’t likely in five years time- at least according to Pulsenomics' recent survey.
The experts seem confident about their predictions when asked what lies ahead; most expect an upwards trajectory rather than anything too dramatic happening over next few upcoming quarters.

The graph above shows that prices are expected to continue rising, just at a slower pace than what we’ve seen over the last year. That means if you own property now and plan on selling it in five years when prices have fully recovered from their recent declines—you will most likely see an increase each year as compared with today's rates of inflation or wage growth (depending). 

As Bill McBride points out in his blog Calculated Risk article “What determines future asset returns? The answer lies not only within supply-side factors but demand side ones too! As he notes: "The real question is this – do people still want houses?" His answer then goes into detail about how both sides need revival before anyone can accurately predict.

“My sense is the Case-Shiller National annual growth rate of 19.7% is probably close to a peak, and that year-over-year price increases will slow later this year.”

The experts are predicting that the average annual appreciation rate will be faster than usual, at 4%. As you can see from this chart and as forecast by Black Knight (the company who provides data for these projections), we should expect to see prices rise in line with historical norms.

What does this mean for you?

Experts believe that home prices will continue to rise, with the average annual appreciation rate expected at 4%. This means if you’re looking for a purchase in 2020 and want it now before prices drop back down again - don't wait! Experts say they aren't predicting any sudden fluctuations so buy today while opportunity still exists.

As the housing market continues to grow, your home's value may also be on an upswing. If you're ready for this trend and would like it confirmed by working with a professional realtor who has experience in analyzing homes at different points of their life cycle; I can help!

Let’s connect to talk about the housing market today, where things are headed and what that means for you. Experts expect price deceleration not depreciation over coming years!

In this economy it's important just because prices go down doesn't mean anything else will be easy or available so let me walk through all angles of your situation while guiding us towards a positive outcome.

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