Even though a lot of information shows that home prices are going up in many places, some people still worry that prices might suddenly drop. A recent survey by Fannie Mae found that 23% of people think home prices will go down in the next year. That’s almost one in four people feeling this way—maybe you’re one of them.
To help make you feel less worried, experts are sharing what they think will happen with home prices, not just in the next year, but also in the next five years.
Experts Project Ongoing Appreciation
If a few expert opinions haven’t convinced you, maybe a larger group will. Here’s information from a big group of experts.
The Home Price Expectation Survey (HPES) from Pulsenomics is a useful tool to see what many experts predict for home prices over the next five years. This survey collects forecasts from over 100 economists, investment strategists, and housing market analysts. In the most recent quarterly release, the results indicate that home prices are expected to increase each year until 2027 (check the graph below).
Although the expected rise in 2024 is not as big as in 2023, it’s important to remember that home price appreciation adds up over time. In simple terms, if the experts are right and your home’s value increases by 3.32% this year, it should go up by another 2.17% next year.
If you’re concerned about home prices dropping, here’s the main point to remember. While prices may differ from one area to another, experts predict that they will keep going up throughout the country for several years at a pace that is considered more typical for the housing market.
What Does This Mean for You?
If you still have doubts, take a look at these numbers. They illustrate how the value of an average home might change in the next few years based on the expert projections from the Home Price Expectation Survey (HPES). See the graph below for more details:
To put it in simple terms, imagine you purchased a $400,000 home at the start of this year. According to the HPES forecast, you might end up gaining over $71,000 in household wealth over the next five years.
Bottom Line
If you’re anxious about home prices dropping, many experts believe the opposite will happen. Nationally, they predict that home prices will keep rising, not just next year but for several years. If you have questions or concerns about what’s expected for home prices in our local area, feel free to reach out. Let’s connect and discuss.
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Mon, 25 Dec 2023 20:37:42 +0000
by Mottek Group