Ten markets will see residential property values rise an average of 7.85% in the next year – more than twice the 3.7% rate projected for the rest of the country, according to the latest VeroFORECAST from Veros Real Estate Solutions.
But while this might sound great, the average growth of the top 10 is a half-percent drop from the 8.3% we projected last quarter. This is part of a softening that, while significant, is simply a slowing down of most markets.
The overall housing market is still expected to remain healthy, as the fundamentals – including historically low interest rates and a strong economy with low unemployment rates – remain strong.
Other than that, our Top 10 list has been consistent in two areas. First, it continues to be made up almost exclusively of small-to-modest-sized markets, where low housing supplies and steady population growth are driving higher demand. Second, it tends to be made up of MSAs in Northwestern states. Seven MSAs in our Top 10 are in Idaho and Washington.
The Lone Star State is also ranking high. Midland and Odessa form the Combined Statistical Area where most of the state's oil production activities are headquartered, making it the fastest-growing region in the nation from 2010 to 2015.
The final MSA in this report's Top 10 is the exception to the small-to-modest-sized MSA rule. And, not only is it the one large market in the Top 10, it's one of the largest in the United States.
Here are the 10 markets projected to see the highest rates of appreciation through March 1, 2020:
- Idaho Falls, ID……………………………………………………………… 10.2%
- Odessa, TX……………………………………………………………………. 8.8%
- Boise City-Nampa, ID……………………………………………………… 8.7%
- Bellingham, WA…………………………………………………………….. 7.8%
- Olympia, WA…………………………………………………………………. 7.6%
- Midland, TX…………………………………………………………………… 7.5%
- Phoenix-Mesa-Glendale, AZ……………………………………………. 7.1%
- Spokane, WA…………………………………………………………………. 7.0%
- Yakima, WA…………………………………………………………………… 6.9%
- Kennewick-Pasco-Richland, WA…………………………………….. 6.9%
