What Are the Experts Saying About Future Home Prices?

Dated: June 23 2020

Views: 69

A worldwide pandemic and an economic recession have had a tremendous effect on the nation. The uncertainty brought about by both has made predicting consumer behavior nearly impossible. For that reason, forecasting home prices has become extremely difficult.

Normally, there’s a simple formula to determine the future price of any item: calculate the supply of that item in ratio to the demand for that item. In housing right now, demand far exceeds supply. Mortgage applications to buy a home just rose to the highest level in 11 years while inventory of homes for sale is at (or near) an all-time low. That would usually indicate strong appreciation for home values as we move throughout the year.

Some experts, however, are not convinced the current rush of purchasers is sustainable. Ralph McLaughlin, Chief Economist at Haus, explained in their June 2020 Hausing Market Forecast why there is concern:

“The upswing that we’ll see this summer is a result of pent-up demand from homebuyers and supply-in-progress from homebuilders that has simply been pushed off a few months. However, after this pent-up demand goes away, the true economic scarring due to the pandemic will begin to affect the housing market as the tide of pent-up demand goes out.”

The virus and other challenges currently impacting the industry have created a wide range of thoughts regarding the future of home prices. Here’s a list of analysts and their projections, from the lowest depreciation to the highest appreciation:

We can garner two important points from this list:

  1. There is no real consensus among the experts.
  2. No one projects prices to crash like they did in 2008.

Bottom Line

Whether you’re thinking of buying a home or selling your house, know that home prices will not change dramatically this year, even with all of the uncertainty we’ve faced in 2020.

Posted on Keeping Current Matters

Latest Blog Posts

Buyers Want a House With These Popular Outdoor Features in 2021

Photo Credit: Dalila Dalprat, PEXELS.COMOwning a house is more than just paying the mortgage and doing simple maintenance. The upgrades and improvements you make throughout your time there will help

Read More

Help Pandemic-Weary Homeowners Create Kid-Friendly Spaces

Belgravia GroupThe Belgravia Group's children's room design in Triangle Square, located in East Bucktown, Chicago.Help Pandemic-Weary Homeowners Create Kid-Friendly SpacesMany families are

Read More

More Borrowers Are Turning to Credit Unions for Loans

Photo by Tima Miroshnichenko from PexelsMore Borrowers Are Turning to Credit Unions for LoansCredit union membership and lending is growing as borrowers increasingly turn to them for

Read More

Mortgage Rates Hold at 2.73% Average for Another Week

Mortgage Rates Hold at 2.73% Average for Another WeekThe 30-year fixed-rate mortgage continued to hover near its all-time low, offering low borrowing costs to home shoppers and refinancers. The 30

Read More