Daily Real Estate News | Wednesday, July 30, 2014
The housing market is going to surge in 2015, despite the bearish predictions from many critics in the housing industry recently, according to a report to be released today by Altos Research, a housing data provider.
“While we see signs of demand easing, we are significantly more bullish on housing than many of the recent headlines seem to suggest,” says Michael Simonsen, Altos CEO. “Based on our models, we’re forecasting another year of home price appreciation, with a 7 percent home price increase for the year of 2015.”
Altos is also projecting for-sale inventories to rise another 10 percent. Researchers point out that the number of days on the market remains low compared to prior to the housing crisis, an indicator of a seller’s market.
Some other housing experts in recent weeks have projected that a depreciation in the nation’s housing market is coming. But Altos researchers are blaming it on recent negative headlines throughout the media: “In our view, these attitudes reflect a myopic view of actual market conditions and conflate concerns over the mortgage industry, the otherwise-constrained new construction market, and more broadly, the long-term financial stability of the U.S. consumer with specific current housing market supply and demand dynamics. While these are valid long-run concerns, the variables impacting home prices have proven to be driven by low available supply and growing household formation.”
Altos researchers say that home prices across the country are poised for a fifth consecutive year of recovery. “The market is still faced with low inventory and demand, buoyed by an expanding economy, which, among other factors, remains healthy,” according to the report. “Both supply and demand conditions are moving from extreme bullish conditions to healthy condition.”
Source: “Altos: Critics Wrong About Housing, It’s Going to Soar,” HousingWire (July 29, 2014)