SANTA ANA, Calif.–The housing market’s gradual recovery on a national level has picked up “measurable speed,” according to new analysis from Veros Real Estate Solutions.
Veros, a provider of enterprise risk management, collateral valuation services and predictive analytics, recently released its VeroFORECAST real estate market forecast for the 12-month period ending Sept. 1, 2013.
The Next 12 Months
Veros said the forecast for the next 12 months has “improved significantly” on a national basis, from last quarter’s 0.26% forecast depreciation to the current forecast appreciation of 1.1%. The five projected strongest markets have seen a great deal of progress, the company said, thanks mainly to decreased housing supply and the continuing low interest rates. The five projected weakest markets are doing far better than in last quarter’s forecast, as well.
Atop the list of strongest markets once again, Phoenix metro gained 1.9 percentage points from the previous quarter’s 6.4% forecast appreciation figure to its current forecasted 8.3%. “Phoenix has benefited from a drastically reduced housing supply, which has plummeted by more than 70% from its peak,” said Eric Fox, Veros’ vice president of statistical modeling, analysis and research, who also noted Phoenix has a lower unemployment rate, as well.
On the opposite end of the spectrum, Atlantic City, N.J., emerged as the weakest market. The positive news here is that at -4.3%, the weakest market in this report is somewhat improved from last quarter’s weakest, which registered -5%. In the previous report, all the remaining areas in the bottom five were in California; none of those areas appear among the weakest five in this forecast report. “Atlantic City unemployment is at a high 13.0% and housing inventory remains stubbornly high as well,” said Fox. “This, in conjunction with high foreclosure and mortgage delinquency rates, is keeping pressure on pricing in this market. Moreover, the population in the last decade has dropped almost 3%.”
Key factors for all markets are unemployment rates and housing inventory; where unemployment remains at or above the national average, markets tend to suffer with unsold homes and depressed demand. In many markets seeing easing in unemployment, housing inventories are being absorbed and prices are responding.
“Things are improving in all aspects,” said Fox. “In last quarter’s forecast, the bottom five markets were in the -5.0% to -4.3% range, and now they are in the -4.3% to -2.7% range, representing a marked strengthening,” he said. “The numbers are showing us that the stronger markets are continuing to gather steam and the weaker markets are showing continual improvement.”
For info: www.veros.com