For home buyers looking to find a home to buy in the next few years, the highlight topic is house prices. Home buying potential is fed by what prices are now, and where they may go in the coming years. Discerning prospective home buyers will watch house prices closely to try and assess patterns or changes as they try to find a home. However, the reports on house prices are often quarterly, and look back to the most recent quarter, with estimations as to potentials for the coming quarters.
The Pulsenomics Home Price Expectation Survey comes out quarterly like many other house price reports, but it takes the data points a step further, combining house price surveys from a nationwide panel of over 100 economists, real estate experts and investment strategists about house price potentials for the next 5 years.
The quarterly report makes an average of all the experts for each line item.
Based on their most recent report:
- Home values will appreciate by 4.6% in 2014.
- The cumulative appreciation will be 19.5% by 2018.
- That means the average annual appreciation will be 3.6% over the next 5 years.
- Even the experts making up the most bearish quartile of the survey still are projecting a cumulative appreciation of 11.2% by 2018.
Why Longer Projections Help Home Buyers
Whether you are buying your first home or looking to sell your home and move to a new one, understanding the potential of home prices for several years in advance gives home buyers and sellers the knowledge to know when they can turn the best advantage in their home purchase and/or sale.
For example, for the home seller who is also looking to find a home to buy but perhaps their current home is on the lower tier of prices, the decision may be made to buy their next home now and maintain their current property, but rent it for a year or two until the price increases a bit more. This is just one example of how long-term foreknowledge of house prices can empower the market.
No matter your current home situation, it is always recommended that you meet with a real estate and mortgage professional at the outset of the home search. They will have first-hand knowledge of the inventory and home loan options available in your target region.
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