Veros: Overall Market Strength to Continue; Washington Set to ‘Boom’

Veros Real Estate Solutions, Santa Ana, Calif., said residential market values will continue their overall upward trends during the next 12 months, with only a small percentage of markets projected to depreciate.

The company’s quarterly VeroFORECAST projects overall annual forecast appreciation of +4.2%, higher than last quarter’s +4.0%. It said only 3% of markets are expected to depreciate, unchanged from the previous quarter.

“The market as very strong for the overall U.S. residential real estate market,” said Eric Fox, Vice President of Statistical and Economic Modeling with Veros.

The report said Washington is set to “boom,” occupying all of the Top 5 market spots, which Fox noted has never happened before. Seattle ranks first with expected appreciation of more than 12% followed by Bellingham, Bremerton, Kennewick, and Mount Vernon, all near 10%. Metro areas in Colorado, Idaho, Oregon and Washington comprise the Top 10.

“These markets show no signs of letting up as supply of homes is exceedingly low and population continues to grow,” Fox said. “If you want strong appreciation, move to the Northwest portion of the U.S.”

Conversely, Veros reported 12 of the bottom 25 markets are in Northeastern states: Connecticut, New Jersey, Maine, West Virginia, Maryland, Pennsylvania and New York. Bangor, Maine is forecast to be the worst performing market with 2.0% depreciation with the markets of Bridgeport, Longview, Vineland, and Atlantic City forecast to have 1.0% depreciation over the coming year.

“Unfortunately, the fundamentals of these markets remain static with flat or declining populations and relatively high unemployment rates,” Fox said. “These factors contribute to a high housing supply with low demand that are unlikely to change anytime soon.”

The report also noted parts of California should see an uptick in appreciation, particularly in San Diego, San Jose, Los Angeles and Sacramento; while many Texas markets could see continued softening, with Dallas and Austin losing 1% in forecast appreciation since the previous quarter.