Las vegas projected to lead house price growth in 2013
The firm’s latest market report shows that home prices continue to benefit from the more active spring buying season across the country, with quarterly, yearly and two quarter forecasts all in stronger, at 1.4%, 8.6%, and 1.7% respectively, relative to months past.
As a result, Clear Capital’s price growth forecast has been increased from 2.6 per cent (predicted in April 2013) 6 per cent. Indeed, 45 out of the top 50 major metro markets are forecast to see yearly growth over the final two quarters of 2013. Four of the five markets not expected to see home price gains over the next two quarters are projected to see declines of less than 0.5 per cent.
At the head of the Pack? Las Vegas. The state held its lead in June with yearly gains of 29.3 per cent. The metro is one of six others to have realized more than 20.0 per cent in yearly growth. Considering the two quarter forecast for Las Vegas of 5.0 per cent, the metro will likely end the year as the recovery front runner with total 2013 gains of 19.4 per cent.
“June home price trends and forecasts were nearly all positive across the country”, said Dr. Alex Villacorta, vice president of research and analytics at Clear Capital.
“We saw quarterly, yearly and six month forecasts all tick up, relative to the past few months’ performance. These improved trends signal spring buying activity continues to have a positive impact, while our forecasts point to moderation ahead. Certainly this is an interesting and important dynamic unfolding and while it could seem contradictory at the surface, perspective lends clarity. Increasing gains are great news for homeowners and to be expected at this time of the year, when home buyers are typically most active. While there is a lot of buzz right now in terms of double digit housing gains, over the long run, we don’t expect to see the current rates of growth sustained. Keep in mind this is really not a bad thing. National growth for all of 2013 is expected to hit 6.0%, lower than current yearly growth of 8.6%, yet higher than historical norms between 4.0% and 5.0%. After more than a full year of recovery, we consider the current momentum and expected moderation a really healthy move toward a more sustained recovery.
“At the metro level, we saw some subtle, yet notable trends unfold in June. While price trends continued to diverge at the micro market level, they are for the most part positive. Our forecasts highlight expected price gains across the country over the rest of 2013. This is a really important piece to the recovery puzzle right now. The fact that 45 out of 50 major metro markets are expected to see price gains over the next six months speaks to this move toward a more balanced, broad-based recovery, another really healthy sign. It’s great that six metros have seen more than 20.0% growth over the last year, but on their own these few markets can’t support a long-term national recovery. Seeing the bulk of major metros move into positive territory is truly good news, even if their gains are still in the single digits.”