CoreLogic is estimating home prices will rise only moderately in 2019. With home prices in some areas up double digits in 2018 many metropolitan areas are considered overvalued. Forty five (45) percent of renters surveyed by CoreLogic admit they crave home ownership as their part of the American dream, but just don’t feel ready or able to take on the responsibility or risk of buying a home and committing to a new mortgage yet.
As home prices level or rise more slowly, and as mortgage interest rate hikes back off, more renters may become more comfortable in their ability to buy a home to raise their family. For the year 2019, Frank Nothaft, CoreLogic’s chief economist noted a “…forecast of average annual [home] price growth of 3.4 percent.” This is down from the 2018 annual price growth of 5.8 percent and may indicate potential for home sales to begin to rise again.
The averages don’t tell the whole story. Check out the year over year change map here.
Certain metropolitan areas by the end of 2018 were considered overvalued. Las Vegas, Denver/Aurora/Lakewood CO, Miami/Miami Beach FL, Houston TX, DC and its suburbs as well as NYC were some of the metropolitan areas with overinflated home prices in 2018. However, when mapped by state, Nevada and Idaho showed some of the largest home price increases for the nation over the previous year.
If home prices stabilize in and near those popular metropolitan areas, and mortgage interest rates remain stable, it could offer the incentive renters need to enter the market and buy their piece of the American dream.