Las Vegas forecast to lead 2013 home price gains
Home prices nationwide continue to benefit from a more active spring-buying season, Clear Capital said.
The quarterly, yearly and two quarter forecasts all came in stronger at 1.4%, 8.6% an 1.7%, respectively, relative to past months. This is a dramatic improvement of 6% over the 2.6% growth projected in Clear Capital’s April 2013 report.
"June home price trends and forecasts were nearly all positive across the country," said Alex Villacorta, vice president of research and analytics at Clear Capital. "We saw quarterly, yearly and six month forecasts all tick up, relative to the past few months' performance. These improved trends signal-spring buying activity continues to have a positive impact, while our forecasts point to moderation ahead."
The real estate data company attributes this improvement to increased home prices throughout the county, continuous improvements in distressed market measures and gains in broad-based economic inputs, including consumer confidence.
If the forecast plays out as anticipated, the housing market may outperform historical average gains between 4.0% and 5.0%, but analysts estimate some moderation from the current yearly gains of 8.6%.
Broken down regionally, home price gains saw moderate growth in the short-term and long-term forecast.
The West is expected to see a total 2013 gain of 10.1%, while the South will stay closer to 5.2% if predictions prove true. The Midwest and Northeast are forecasted to see total yearly gains of 4.6% and 4.1%, respectively.
Of the top 50 markets, 45 are predicted to see yearly growth over the final two quarters of 2013.
Las Vegas stayed strong in June with early gains of 29.3%. The Las Vegas market is one of six others that have more than 20% yearly growth.
"This is a really important piece to the recovery puzzle right now. The fact that 45 out of 50 major metro markets are expected to see price gains over the next six months speaks to this move toward a more balanced, broad-based recovery, another really healthy sign," said Villacorta. "It’s great that six metros have seen more than 20% growth over the last year, but on their own these few markets can’t support a long-term national recovery. Seeing the bulk of major metros move into positive territory is truly good news, even if their gains are still in the single digits."
Cleveland is expected to struggle with home prices declining 2.2% over the next two quarters. The Cleveland market has yet to see the positive fundamental shift in its distressed sale environment that other markets have seen prior to recovery.
"Increasing gains are great news for homeowners and to be expected at this time of the year, when home buyers are typically most active. While there is a lot of buzz right now in terms of double-digit housing gains, over the long run, we don’t expect to see the current rates of growth sustained," said Villacorta.