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[Pulse] Homeowners in these markets are seeing their property values decline

For most of the country, home prices are seeing gains, but not here

In the next year, 5% of U.S. markets are predicted to depreciate, with Louisiana holding on to its title as the state with the most depreciating markets, claiming four of the 10 spots on the bottom market list.

Connecticut and Arkansas each contribute two markets to the Bottom 10 markets for home price appreciation, and Illinois adds Danville, a perpetual Bottom 10 finisher.

Grand Forks, North Dakota-Minnesota, returns to the Bottom 10 after a quarter away, with a projected depreciation of -1.9%. 

Overall, the VeroFORECAST projects that residential real estate in the nation's 100 largest markets will appreciate an average of 3.7% over the upcoming year, which extends the previous quarter's report average rate of appreciation.

This signals a leveling out after a four-quarter decline from projected average appreciation of 4.5% a year ago. 

The Bottom 10 are forecast to depreciate just -1% or -2%. So, while these areas are struggling, it does not signal concern for real estate markets overall.

The percentage of markets projected to depreciate has remained at 5% since fourth quarter 2018, when it rose from 3% the previous quarter.

Housing supply is a key determining factor between the VeroFORECAST Top and Bottom 10 lists, both of which are dominated by small-to-modest-sized MSAs. Markets with an overabundance of properties for sale will see prices remain low. Slow population growth or declining population also contribute to weak demand and push markets into the lowest ranks of the forecast.

Though not in the Bottom 10, the New York-Northern New Jersey-Long Island MSA is worth mentioning. Here in the nation's largest and most diverse market, the famous borough of Manhattan is forecast to depreciate at -2.5% – a higher rate than anything on the Bottom 10.

Here are those Bottom 10 markets:

  1. Grand Forks, ND-MN……………………………………………………… -1.9%
  2. Bridgeport-Stamford-Norwalk, CT………………………………….. -1.7%
  3. Baton Rouge, LA…………………………………………………………….. -1.6%
  4. Lafayette, LA………………………………………………………………….. -1.2%
  5. Norwich-New London, CT………………………………………………. -1.0%
  6. Danville, IL ……………………………………………………………………. -0.9%
  7. Shreveport-Bossier City, LA …………………………………………… -0.7%
  8. Hot Springs, AR …………………………………………………………….. -0.6%
  9. Jonesboro, AR ……………………………………………………………….. -0.4%
  10. Houma-Bayou Cane-Thibodaux, LA ……………………………….. -0.3%

 

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