Veros Real Estate Solutions is predicting that U.S. home prices will increase an average of 3.2% from March of this year to March 2016 – an improvement over its February forecast, which predicted that home prices would appreciate 2.4% year over year.
According to the firm's VeroFORECAST report, about 86% of U.S. markets are expected to see home prices rise over the next year, up from the 82% predicted in February.
The report – which is updated quarterly and covers 967 counties, 333 metro areas, and 13,549 zip codes – finds that as of March, the hottest markets for home price appreciation were on the west coast, whereas markets with lowest appreciation were on the east coast.
Reminiscent of Dickens' classic story, the report reveals a ‘Tale of Two Coasts’ in the forecasting the top and bottom residential markets. Six out of the top 10 appreciating markets are located within a 75-mile radius in the Bay Area of California. Conversely, six out of the bottom 10 were located within a 100-mile radius in the Northeast coastal area.
‘We continue to see the same factors influencing the appreciation or depreciation of residential markets across the country,’ says Eric Fox, vice president of statistical and economic modeling for Veros, in a release. ‘Unemployment rates, housing supplies, and population trends remain the primary factors affecting the housing market.Â Their impact is clearly reflected in the market forecasts for these coastal areas.’
Markets that are forecast to see the most home price appreciation over the next 12 months include Santa Rosa-Petaluma, Calif. (10.0%); San Francisco-Oakland-Fremont, Calif. (9.9%); Denver-Aurora-Broomfield, Colo. (9.3%); San Jose-Sunnyvale-Santa Clara, Calif. (9.2%) and Austin-Round Rock-San Marcos, Texas (8.8%).
Markets that are forecast to see the least home price appreciation (or highest depreciation) over the next 12 months include Vineland-Millville-Bridgeton, N.J. (-3.9%); Sumter, S.C. (-2.6%); Salisbury, Md. (-2.6%); Atlantic City-Hammonton, N.J. (-2.4%), Jacksonville, N.C. (-2.3%).