You know that Tri-Cities home prices, much like home prices all over the country, have been rising in recent years at a faster pace than normal. It's great news for homeowners who've sold recently or are planning to sell soon.
At the national level, home prices have increased, or appreciated, for 114 straight months. Locally, the median price of a Tri-Cities home rose from $300K to $400K between April 2019 and August 2021.
But the big question is, How long will this home price appreciation continue?
The independent research firm Pulsenomics surveyed over 100 economists, investment strategists, and housing market analysts asking for their five-year projections. The results? Experts say the market may see some slight deceleration, but not depreciation.
Here's the forecast for the next few years:
As the graph above shows, prices are expected to continue to rise, just not at the same pace we've seen over the last year. More than 100 experts agree: There is no expectation for prices to depreciate. As the arrows indicate, each number is an increase, which means prices will rise each year.
Bill McBride, author of the blog Calculated Risk, also expects deceleration, but not depreciation:
"My sense is the Case-Shiller National annual growth rate of 19.7% is probably close to a peak, and that year-over-year price increases will slow later this year."
Ivy Zelman of Zelman & Associates agrees, saying:
"...home price appreciation is on the cusp of flipping to a decelerating trend."
A recent article from realtor.com indicates you should expect:
"...annual price increases will slow to a more normal level..."
What Does This Mean for You?
Expert projections for the years ahead are more in line with the historical norm for appreciation. According to data from Black Knight, the average annual appreciation from 1995-2020 is 4.1%. As you can see from the chart above, the expert forecasts are closer to that pace, which means you should see appreciation at a level that's aligned with a more normal year.
If you're planning or waiting to buy, don't expect a sudden or drastic drop in home prices – experts say it won't happen. Instead, think about your homeownership goals and consider purchasing a home before prices rise further.
If you're a seller, the continued home price appreciation is good news for the value of your house. Work with an agent to list your house for the right price based on market conditions.
Final Thoughts
Experts expect price deceleration, not price depreciation over the coming years. Let's connect to talk through what's happening in the housing market today, where things are headed, and what it means for you.
- Cari
