August 4, 2014 by Jeff Lowen
July home prices appear to be up 8.4% from last year at this time. Although, a 0.6 percentage point drop from last month’s year-over-year comparison. While the decline moves us closer to more normal rates of growth, which is around 3%-5%, this recovery seems to be fragile as we enter the second half of the year. Gains in Phoenix, a first in, first out market, are seeing a pullback as investor opportunity in the distressed and low tier segment dries up. Riverside, CA, the current recovery leader, is also seeing a slowdown in price appreciation. No matter how you slice it, gains are diminishing.
As moderation continues to take hold nationwide, a dive into local market trends tell the real story. Markets driven by investor demand will remain in a precarious position (Whatever that means! 😉 as we enter 2015, while moderating markets with strong local economic foundations, like Seattle and San Jose, could be more resilient. If you’re keeping score, eight of the top 15 markets in July are in the West. A look at our forecast through 2015 projects price declines of 0.8% for the West, looking like the region may not be able to support diminishing gains through next year. Surprisingly, the historically volatile Midwest could be home to the recovery’s next group of heroes, with leading forecasted growth at 3.4%.
What does all this mean to you and I? Stay tuned, of course. And if you’re planning on making a move, investing, or know someone who could benefit from this info, let us know. We’re now a part of NNREPI. The Nationwide Network of Real Estate Professionals and Investors. A liaison to pair you up with the best man (or woman) for the job!