The good news: Even the worst markets won’t depreciate more than 5% or 6% in the year ahead, according to Veros. That’s a relief from the double-digit drops in the past.
But the top markets aren’t expected to see runaway growth either: The strongest markets in the country aren’t expected to appreciate more than 4% in the year ahead, according to Veros.
Below are the markets expected to perform the best in the next year, along with their projected home-price increases:
- Bismarck, N.D., 3.8%
- Wichita Falls, Texas, 2.6%
- Buffalo/Niagara Falls, N.Y., 2.1%
- Honolulu, 2%
- Anchorage, Alaska, 1.9%
The strength of the local economy has a lot to do with the strength of its housing market.
“Bismarck’s unemployment rate is 2.9%. No one is worried about losing their job, and prices reflect that,” Fox said. He also pointed out that commodities are strong, and North Dakota produces a lot of them — from natural gas to wheat.
Top large cities include Washington, D.C. and Boston.
Recovery could be years away
From a national perspective, RealtyTrac is predicting that the market will bottom out, in terms of sales and pricing, this year. But the recovery will appear flat two years after that, with meaningful appreciation occurring in 2014 or 2015, the company projects.
However, it’s also worth noting that while economists speak of a national bottom in housing prices, individual markets bottom at different times, said Jim Gillespie, chief executive of Coldwell Banker Real Estate.
The Case-Shiller index, for example, may provide a snapshot of prices in 20 large cities, but it’s not indicative of every market, he said.
Furthermore, most home buyers intend to be in the home they purchase for seven to 10 years, Gillespie said. And Sharga said that’s enough time for a buyer to recover from any early losses right after they purchase.
“If you’re looking at being in a property more than a couple of years, you will certainly be able to weather that storm,” Sharga said.
“If you’re a buyer, it’s still a good time to be in the market,” he said. “No one is going to be able to time the bottom locally or nationally… the only way you know you’ve hit bottom is when prices come back up.”
(Information obtained from Amy Hoak, MarketWatch)