Future of Home Price Appreciation and What It Means to YOU
Many consumers are wondering what will happen with home values over the next few years. Some are concerned that the recent run-up in home prices will lead to a situation similar to the housing crash 15 years ago.
However, experts say the market is totally different today.
“We do need price appreciation to slow today. High price growth today is supported by fundamentals like short supply, lower rates and demographic demand. We are in a much different and safer space: better credit quality, low debt to income and tons of equity. A crash in prices is very unlikely.” Source: Odeta Kushi, Deputy Chief Economist, First American.
Price appreciation will slow from the double digit levels the market has seen over the last two years. However, experts believe home values will NOT depreciate.
Below are the expected year over year rates of home price appreciation based on the average of all 100+ projections.
- 2022 9%
- 2023 4.74%
- 2024 3.67%
- 2025 3.41%
- 2026 3.57%
Home price appreciation is likely high during this year but will then return to more normal levels over the next four years.
What Does This Mean for You as a Buyer?
With a limited supply of available homes for sale and both prices and mortgage rates increasing, it can be a challenging market to navigate as a buyer. Buying a home sooner rather than later does have its benefits. If you wait to buy, you will pay more in the future. If you buy now, you will be in the position to make future price increases work for you. Once you buy, those rising home prices will help you build your home’s value and equity.
Bottom Line
If you are trying to decide whether to buy now or wait, the key is knowing what’s expected to happen with home prices. Experts say prices will continue to climb, just at a slower pace. So, if you are ready to buy, doing so now may be your best bet for your wallet. Let’s get started today. Call Ben 203.313.0013
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