VeroFORECAST Shows 2017 Housing Market to Maintain Overall Strength, with Seattle and Denver Continuing to Lead
Apr 10, 2017
Santa Ana, Calif. – April 10, 2017 – Veros Real Estate Solutions (Veros) reports that residential market values will continue their overall upward trends during the next 12 months, with overall annual forecast appreciation of +3.5% which is slightly lower than last quarter’s forecast appreciation of +3.7%. Only 4% of markets nationwide are expected to depreciate.
This insight comes from the company’s most recent VeroFORECASTSM, a quarterly national real estate market forecast for the 12-month period ending March 1, 2018.
The Q1 VeroFORECAST shows general market strength for the overall U.S. residential real estate market with the same markets forecast to continue to do well as compared to last quarter’s report. 9 of the top 10 U.S. markets are in the Northwest corner states of Washington, Oregon, and Colorado. “Seattle and Denver again lead the way in the #1 and #2 spots with forecast appreciation of 10.7% and 9.6%, respectively,” says Eric Fox, VP of Statistical and Economic Modeling at Veros.
“The Seattle market remains strong with a supply of homes at barely over 1.0 month, continued population growth, and unemployment at only 4.2% compared to the national rate of 4.8%. Similarly, Denver’s supply of homes is tight at 1.2 months. This coupled with its modest unemployment rate of 2.8% and rapid population growth, makes Denver one of the strongest markets in the U.S. Parts of Texas (Dallas and Austin), as well as a few Florida cities, mimic these trends and are expected to remain strong.”
The big news is that despite the overall market strength, interest rate sensitive markets are starting to show signs of cracking,” Fox continues. “These markets are predominantly very expensive, and interest rate increases significantly soften demand for consumers on the margin of affordability. For example, markets in California’s Bay Area show continued weakening of their forecasts in anticipation of higher interest rates. San Francisco is forecast to appreciate only 4% in the next year which is down from last quarter’s forecast of nearly 6%. San Jose shows a similar pattern, appreciating at slightly over 4% this quarter from more than 6% last quarter. The long-range forecast for these markets shows even stronger weakening, moving down to a mere 1% appreciation rate at the end of the 24-month horizon.
The bottom performing markets are expected to depreciate around 1% or 2% and the worst three markets are expected to be in Arkansas. The worst performing market is expected to be Hot Springs, AR, with forecast 2.6% depreciation followed by Fort Smith (-2.4%) and Pine Bluff (-2.1%). Others in the bottom 5 include Torrington, CT (-2.0%), and Binghamton, NY (-1.8%). “Consistently, the worst performing markets in the country are areas where population trends have either been flat or on a steady decline for years,” Fox elaborates.
Additional forecasts and infographics available to press upon request.
About Veros Real Estate Solutions
Mortgage technology innovators since 2001, Veros is a proven leader in enterprise risk management and collateral valuation services. The firm combines the power of predictive technology, data analytics, and industry expertise to deliver advanced automated solutions that control risk and increase profits throughout the mortgage industry, from loan origination to servicing and securitization. Veros’ services include automated valuation, fraud and risk detection, portfolio analysis, forecasting, and next-generation collateral risk management platforms. For more information, visit www.veros.com or call 866-458-3767.
About Eric Fox, VP of Statistical and Economic Modeling:
Eric Fox received his M.S. in Statistics and B.S. in Mathematics and Economics from Purdue University, and has more than 22 years of industrial experience in statistical and econometric modeling, probabilistic life methodology development, statistical training, probabilistic design software development, and probabilistic financial/competitive analysis. Fox has published more than 20 technical papers on probabilistic and statistical methods.
Jennie L. Craig
Veros Press Desk
p: 714.415.6300, option 6