SEATTLE-Those who follow @GlobeStcom on Twitter and @GlobeStLIVE may have seen a post teasing the announcement, but GlobeSt.com has learned that a nationwide panel of more than 100 professional forecasters expects home values to end 2013 up an average of 4.6% and rise cumulatively by 22%, on average, over the next five years, according to the first quarter Zillow Home Price Expectations Survey. Additionally, a majority of panelists indicated support for policies that would allow certain underwater homeowners to refinance at today's low rates.
Survey respondents predicted home values will rise another 4.2% on average in 2014, before moderating somewhat to annual appreciation rates between 3.6% and 3.8% for 2015, 2016 and 2017.
On average, panelists predicted home values to rise 4.1% annually from 2013 through 2017, exceeding the pre-housing bubble (1987-1999) average annual appreciation rate of 3.6%. This is the first time the predicted average annual growth rate for the next five years has surpassed pre-bubble levels since the survey's inception three years ago, according to Zillow.
The firm's chief economist, Stan Humphries, points out that “The panel is quite bullish on home prices near-term.” He notes that with that said, “their expectations are a bit shy of the home value gains of 5.5% that we saw in 2012, implying some moderation in the pace of gains. The panel expectations are consistent with continued strong home value growth this year fueled by tighter-than-normal inventory of for-sale homes and robust demand attributable to high affordability and a stronger general economy.”
The most optimistic of panelists predicted a 6.1% increase in home values in 2013, on average, while the most pessimistic predicted an average increase of 3%. Through 2017, panelists predicted cumulative home value changes of 22%, on average. Expectations for cumulative home value change projections ranged from 34.2% among the most optimistic quartile to 11.7% among the most pessimistic, on average.
To see more on the numbers, check out the graphs below.
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