A recent survey by Zillow that interviewed 107 panelists about when they expect the U.S. housing market to normalize. 30% of panelists said they expected the market to stabilize one to two years from now, 40% said it would take 3-5 years and 20% said it will within the next 12 months.
According to a recent survey by Zillow (Z) that interviewed 107 panelists, shifting demographics and would-be first-time homebuyers financially ill-prepared to buy will continue to hold back the housing market over the next several years.
“We’ve reached a point in the recovery where the only real cure-all is time,” said Zillow Chief Economist Stan Humphries. “The market remains very challenging for younger, first-time homebuyers who face an uphill battle saving for a down payment, qualifying for a mortgage and finding an affordable home to buy.”
Then at the other side of the age spectrum, many older homeowners are trapped underwater or are unable to find buyers for their homes.
But Humphries noted that it is not all bad news. “The landscape is slowly changing, as incomes begin to grow, negative equity fades and new households start to form. These shifts won’t occur overnight, but they are happening. Patience will be a virtue over the next few years as we wait for these traditional fundamentals to more fully take hold in the market,” he explained.
Additionally, panelists said they expect U.S. median home values to rise 4.8% in 2014, on average, to $176,760, and another 3.7% in 2015.
“The expert consensus calls for only a marginal increase in home values nationally for the remainder of 2014, and a leveling-off of annual increases through 2019,” said Terry Loebs, founder of Pulsenomics, which conducted the survey.
“The 3.7% average annual appreciation rate expected by the panel for 2015 represents a 20% drop from the rate expected for this year. Although this projected decline is significant, it’s a less dramatic call compared to that made by our panelists one year ago, when they correctly anticipated a much larger change from 2013’s 7.3% home value appreciation rate by projecting 4.3% for 2014,” Loebs explained.
On a local level, Clark County saw a 9.4% price increase for the 10 month period, with a average price of $273,900. It was the strongest October in closed sales since 2005! Overall, there is a 3.4 month worth of supply for the month of October.
Housing Wire, Brena Swanson, November 11, 2014