Veros: Housing Market Showing Strength, Stability for 2017
Veros Real Estate Solutions, Santa Ana, Calif., said residential market values should continue their overall upward trend during the next 12 months.
The company’s VeroFORECAST shows continued modest gains and geo-polarization as Washington, Oregon and Colorado continue to dominate. The forecast calls for overall annual forecast appreciation of +3.7% (up slightly from last quarter’s +3.5%).
“Although we expect to see interest rates increasing and inflation ramping up, the overall labor market is expected to remain strong,” said Eric Fox, vice president of statistical and economic modeling with Veros. “These effects will essentially offset each other and allow the overall national forecast to remain strong.”
The report said Washington, Oregon and Colorado monopolized the top positions in all of 2016 and continue to hold nine of the top 10 markets in the forecast for the next 12 months. Seattle and Denver lead the way with forecast appreciation of 10.9% and 10.2%, respectively. Bend, Ore., Portland, Ore., and Bremerton, Wash. round out the top five markets; Washington, Oregon, Idaho, and Colorado represent 17 of the top 25 forecast markets demonstrating continued record-setting geographic concentration.
Veros said weakest five performing markets are expected to depreciate between 1% to 2.5%. “Thus, even these worst performing markets won’t see a significant drop,” Fox said.
Veros said the worst performing markets this quarter is expected to be Poughkeepsie, N.Y. (- 2.5%), Binghamton, N.Y. (-1.9%), Atlantic City, N.J. (-1.8%), Cumberland, Md. (-1.7%) and Vineland, N.J. (-1.3%). Record geographic concentration also persists on the weaker end of the forecast spectrum with six of the 10 weakest markets in New Jersey, the Hudson Valley region of New York and Connecticut.
The forecast also predicts continued softening in once-hot markets of south Florida and the Bay Area. Markets such as San Francisco and San Jose are down again by 1% to forecasts in the 5% range. Likewise, south Florida markets such as Miami and Fort Myers are down another 1% to forecast at the 4% range.
“These once-hot markets are now falling to more ‘middle-of-the pack’ metro areas in terms of expected appreciation,” Fox said.
In addition, Fox noted the number of depreciating markets has been cut in half from 7% during last quarter’s update to just 4%. “This is primarily because the markets in portions of the country such as Connecticut or New Jersey have gone from slightly depreciating in previous updates to slightly appreciating in this report,” Fox said.
