What A Difference 5 Years Makes In Home Prices

You can't seem to walk down the block without someone talking about our real estate market. And everyone has their own description of the last 5 years. But I like to look at facts and numbers because well, for the most part, they don't lie. 

CoreLogic recently released their Home Price Index Report. The main indicator used in the report to gauge the health of the housing market was home price appreciation. CoreLogic measured home appreciation from July 2013 to July 2018 to show how prices of the last 5 years have fared.

The graph below shows the 5 year change in price from 2013 to 2018. 

As the graph shows, the highest price appreciation occurred in the lowest home price range with a whopping 48%, while the highest home price appreciated by a more modest 25%. This has been greatly fueled by the lack of inventory of homes available at the lower price ranges and high demand from first-time buyers looking to enter the market.

Where were prices expected to go?

Every quarter, Pulsenomics surveys a nationwide panel of over 100 economists, real estate experts, and investment and market strategists to ask them to project how residential home prices will appreciate over the next 5 years to compile what is called the Home Price Expectation Survey (HPES).

According to the Q3 2014 survey results, national home prices were projected to increase collectedly 19.5% by December 2018. The bulls of the group projected 27.8% and the more bearish of the group predicted 11.2%. 

Where are prices headed in the next 5 years?

Data from the most recent HPES shows that the experts predict home price to increase by 20% over the next 5 years. The bulls of the group project home prices to rise by 31.2% and the cautious bears predict appreciation of 9.3%.

My Advice

Since the smaller homes are where the action and appreciation will mostly be, that is where you should be. If you are a first time buyer, find a way to buy a home NOW...or as soon as possible. Investors, buy the smaller homes and if you can, many of them. Your ROI will be greatest with smart buys in this category. Those looking to step up...now is the time to sell your current home to settle into your dream home. 

Bottom Line

Every day, thousands of homeowners gain positive equity in their homes. Some are experiencing values even greater than those before the Great Recession. If you are wondering if what equity you have in your current home or how to get started looking for your home, reach out to a trusted real estate professional.

About Scott C. Dickinson

Scott C. Dickinson is a real estate broker that resides in Vancouver, WA. He can be reached at ScottYourBroker@gmail.com or call him at 360-518-7197.

Follow him on Facebook at www.facebook.com/YourBrokerScott or on Instagram at www.instagram.com/YourBrokerScott.