Despite ample data showcasing rising home prices in most parts of the country, lingering concerns about an imminent price crash persist among many individuals. A recent survey conducted by Fannie Mae reveals that 23% of consumers anticipate price declines over the next 12 months, hinting at prevalent apprehension—perhaps a sentiment you share.
To alleviate these worries, let's delve into what experts predict for home prices, not just in the upcoming year but over the next five years.
Consensus Points to Ongoing Appreciation
While a handful of expert opinions might not sway your perspective, the collective viewpoint of a larger group could offer reassurance. Enter the Home Price Expectation Survey (HPES) by Pulsenomics, pooling projections from over 100 economists, investment strategists, and housing market analysts. The latest quarterly release affirms an upward trajectory for home prices annually through 2027 (refer to the graph below):
While the projected increase in 2024 appears less significant compared to 2023, it's essential to note that home price appreciation compounds over time. In simpler terms, if the experts' forecasts hold true, following a 3.32% increase in your home's value this year, an additional 2.17% rise could follow next year.
If concerns linger about a potential decline in home prices, consider this major takeaway: despite regional fluctuations, experts foresee a continued upward trend in home values across the nation, albeit at a more standard pace for the market.
Implications for You
To bolster this perspective, consider the figures demonstrating the potential evolution of a typical home's value over the next few years based on HPES expert projections. Check the graph below for insights:
For instance, envision you purchased a $400,000 home earlier this year. By incorporating HPES forecasts, you could potentially accrue over $71,000 in household wealth over the next five years.
For those worried about a looming drop in home prices, take solace in the consensus among experts—it points in the opposite direction. Nationally, the consensus among experts suggests a continued upward trajectory in home prices not just in the coming year but for years ahead. Should you seek clarification or guidance regarding home price trends in your local area, consulting a real estate agent could provide valuable insights.