The new VeroFORECAST is now out with predictions that the 10 Metropolitan Statistical Areas at the top of the report will appreciate from 9.3 to 11.7% through September 1, 2019.
The report, which covers the residences of 82% of the U.S. population in 358 MSAs, also forecasts an average rise in property values of 4.5% for the 100 most populous of them, a tenth of a percent increase over last quarter's number. Housing supply and population trends continue to be the chief indicators of where a market will sit on the nation's appreciation-depreciation continuum. In the top markets the housing supply is very low, which puts project price changes at the high end of the report.
The market with the highest projected average appreciation over the next year is Bremerton-Silverdale, Washington at 11.7% for single-family residences and 11% appreciation for condos and townhomes. The Bremerton market remains one of the strongest markets in the country, with its extremely low 1.4-month supply of homes struggling to fill the demands of its growing population.
Its predicted 11.7% appreciation is six-tenths of a percent higher than the top-ranked market in our VeroFORECAST reports in first and second quarter 2018. That market, in both reports, is right across the Puget Sound from Bremerton: Seattle-Tacoma-Bellevue. It remains in the top 10 this quarter, but drops to tenth place with a 12-month prediction of 9.3%.
Here are the 10 markets at the top of the VeroFORECAST for the year beginning September 1, 2018:
- Bremerton-Silverdale, Washington, 11.7%
- Boise City-Nampa, Idaho, 11.2%
- Las Vegas-Paradise, Nevada, 10.8%
- Bellingham, Washington, 10.6%
- Olympia, Washington, 10.3%
- Carson City, Nevada, 10.1%
- Reno-Sparks, Nevada, 10%
- San Francisco-Oakland-Fremont, California, 9.6%
- Denver-Aurora-Broomfield, Colorado, 9.5%
- Seattle-Tacoma-Bellevue, Washington, 9.3%
ANOTHER TOP MARKET ON THE SOUND
Just over 80 nautical miles north of Bremerton and Seattle, through the interconnected waterways lies Bellingham Bay and another of the report's top-ten appreciating U.S. markets. We predict that both single-family residences and condos/townhomes in the Bellingham, Washington MSA will appreciate on average by 10.6% over the next 12 months. Though the supply of homes in Bellingham is not as low as in Bremerton, it is still under two months, and continues to fall. Its 15-year population growth has been over 30%, far above the national average. That growth is keeping Bellingham among the strongest markets in the country.
Add the fifth-ranked Olympia, WA MSA and Washington again has four of the top ten markets. The other state with a big presence in the Top 10 is Nevada. The Las Vegas-Paradise MSA, the state's largest, returns this quarter to join Carson City and Reno-Sparks, the latter a Top 10 fixture for the last two VeroFORECAST reports. Rounding out the 10 MSAs are Idaho, California and Colorado.
STATES OF PERFORMANCE
The Washington and Nevada markets have dominated each 12-month forecast during 2018. They shared six of the top 10 spots for the first half of the year, and now a seventh. The other three or four spots have been divided each quarter among the same five states: California, with an MSA in each quarter's Top 10, and Colorado, Idaho and Oregon with an MSA in two of the three reports. Texas' one top-ten showing this year was the Midland MSA in the first quarter.
With Boise City-Nampa, Idaho jumping into the Top 10’s second spot with a projected appreciation rate of 11.2%, we see an indication of Idaho's changing economy. After being represented in 2018's first two quarterly reports by Pocatello, Idaho, with 83,000 residents, we now see the state's largest MSA ranking very high. Its 2015 estimates of 700,000 residents account for about 46% of the state's population.
In California, the San Francisco-Oakland-Fremont MSA has a 9.6% appreciation rate forecast, while Colorado's large Denver-Aurora-Broomfield MSA is predicted to see average real estate prices go up by 9.5%.
KEY PREDICTORS
The forecast is created by determining how certain key predictors will impact real estate, at six, 12, 18 and 24-month horizons. This report's 358 MSAs include 1,008 counties, and 13,946 ZIP codes, another increase across all categories from previous reports. The ZIP code and county data are further segmented into low, medium, and high price tiers for both SFRs and condos/townhouses.
