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— Blue State price appreciation slows amid stagnant population and outmigration —
SANTA ANA, Calif., January 22, 2020—Today Veros Real Estate Solutions, an industry leader in enterprise risk management and collateral valuation services, released comparative research for home price appreciation in Red and Blue States across the nation by the end of 2020. According to the Q4 2019 VeroFORECASTSM home prices in the largest 100 markets should increase an average of 3.9% by Q4 2020. As the country prepares for the first-in-the-nation New Hampshire Presidential Primary and Iowa Caucus, Veros has compared projected home price appreciation along party lines for 2020.
The average appreciation in Blue States is forecast to be just 3.5%, while the average appreciation for Red States is projected to be over a percentage point higher at 4.6%. This is partially due to stagnant population growth in many Blue States, such as Illinois, Connecticut and New York. On the other side of the aisle, Red States such as Idaho, Arizona and Utah are experiencing population growth which is resulting in high demand and relatively strong home price appreciation.
The VeroFORECAST for Top Five and Bottom Five Performing States
Through the analysis, Veros observed that 20 of the top 25 states with strong home price appreciation were Red or Red-leaning states. For the bottom 26 states (including the District of Columbia), 15 of them were Blue or Blue-leaning states. In addition to low or no population growth and outmigration happening in many Blue states, another potentially contributing factor that has hampered price appreciation is the $10K cap on the State and Local Tax deduction (SALT). In markets where these taxes are high, particularly in New York, New Jersey, California and Connecticut values are flat or very slow to appreciate in 2020.
In an election year, a lot of attention is paid to trends occurring in national economic models. Recently, the VeroFORECAST home price model has seen a shift away from coastal states that traditionally led the country in home price appreciation. “For years, we saw states with high population centers like California and New York dominating home price escalation,” said Eric Fox, Veros vice president of Statistical and Economic Modeling. “We are now seeing states like Idaho and Arizona leading the way. Outmigration from the coasts to the interior of the nation is undeniable.”
For more information about the VeroFORECAST, visit VeroFORECAST.Download the infographic as a PDF, “Home Price Appreciation Along Party Lines in 2020“Download the infographic as an image, “Home Price Appreciation Along Party Lines in 2020“
VeroFORECAST MethodologyThe quarterly VeroFORECAST reports to clients by subscription and to industry media in a summary overview. The report is a projected increase 12-months forward. The current report is based on data from 349 Metropolitan Statistical Areas (MSAs) that include 13,816 zip codes, 1,005 counties, and represent 82% of U.S. residents.
Source: Veros Real Estate SolutionsThis information is intended for use by the media for economic reporting and should only be used for physical or digital publication or broadcast, in whole or in part, must be sourced as coming from Veros Real Estate Solutions. The company name should appear with the first reference of the data. If the data are illustrated with maps, charts, graphs or other visual elements, the company name must be visible on screen or website. For questions, analysis, interpretation of the data or permission to reproduce, contact Brian Fluhr at BFluhr@veros.com.
About Veros Real Estate SolutionsA mortgage technology innovator 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. Veros is the primary architect and technology provider of the GSEs’ Uniform Collateral Data Portal® (UCDP). Veros also works closely with the FHA to support its Electronic Appraisal Delivery (EAD) portal. For more information, visit www.veros.com or call 866-458-3767.
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