If you’re considering purchasing a house, it’s important to make an informed decision. One aspect to consider is the projected trend of home prices in the upcoming years and how it may affect your investment. While there is currently no significant decline in home prices this year, certain markets may experience appreciation or depreciation in value as time goes by. Therefore, it’s advisable to keep a long-term perspective. According to experts, there is a predicted return to a more stable rate of price appreciation in the future years.
Home Price Appreciation in the Years Ahead
Pulsenomics recently conducted their quarterly Home Price Expectation Survey (HPES), where they surveyed over 100 economists, investment strategists, and housing market analysts. The survey asked them to provide their predictions for home prices in the next five years. The report shows that these experts anticipate a decrease in home prices this year, followed by a return to the usual rate of appreciation until 2027, as depicted in the accompanying graph.
In summary, the main point is that experts do not predict a significant decline in home prices across the country, despite the possibility of varying rates of appreciation and depreciation in different markets. Moreover, when they analyze the long-term perspective, they expect a stable and continuous price appreciation. This serves as a compelling demonstration of why homeownership is a favorable investment over time.
What Does This Mean for You?
After purchasing a home, the value of your property can increase due to price appreciation, which subsequently enhances your household’s wealth. The following is an illustration of the expected changes in a typical home’s value over the next few years, based on the expert projections for price appreciation from the survey mentioned previously (refer to the accompanying graph.
Assuming that you purchased a $400,000 home at the start of this year, and taking into account the projected forecast from the HPES, your household wealth could increase by more than $54,000 over the next five years. This example underscores the fact that buying a home is a reliable long-term investment tool for building wealth. So, if you’re contemplating whether to purchase a home, remember its potential to yield strong financial returns in the future.
Bottom Line
As per the experts’ opinions, although there could be a minor dip in home prices this year, the next five years are anticipated to experience a steady growth in home values. If you’re prepared to become a homeowner, purchasing a home now can establish a foundation for your long-term prosperity, as your net worth is expected to increase in tandem with the predicted growth in home prices. Contact us to commence the homebuying process today.
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by Mottek Group