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Two house price forecasts – both say “up”

by Rob Regan on March 8, 2013

Two bullish forecasts from two different analysts both say home prices will continue to go up… but they differ on how much, and for how long.  What they don’t differ in is their belief that prices are going up by a lot:

I’m taking both quotes from CalculatedRiskBlog

Here’s the first from analysts at Merrill Lynch

We now expect national home prices, as defined by the S&P Case Shiller home price index, to increase 8.0% this year (q4/q4). This follows the 7.3% gain in 2012. … our forecast now assumes faster near-term appreciation, but slower growth in the out years. Our forecast for the cumulative appreciation over the next ten years is little changed.

The second quote is rather more bullish.  This is from analyst Ivy Zelman

[We are in] “the first or second inning of the fundamental recovery that could be five to ten years in duration …”

“I think home prices could go up for four to six years in duration …”

In this CNBC video interview she throws out 20% as an upside number that would get us to “average affordability”.  Please note, her comments are on the national housing market and not on San Francisco’s home market, but three of her big factors – low inventory, low interest rates and high rents are present here in San Francisco.

So what does this mean to you?  Well, buyers should buy… if they can.  I know, it isn’t easy right now with 10, 20 and 30 offers on many properties so you have 1 in 10, 1 in 20 or 1 in 30 chance of “winning”.  Sellers – well, they’ve been holding on tight presumably to sell at higher prices.  But I would caution would-be sellers that if they plan to buy locally or buy up, that unless they can afford to buy without selling, completing your sale and purchase now may be better than waiting.

Thinking of buying a San Francisco home or condo – start here www.SF-MLS-Search.com

Thinking of selling a San Francisco home or condo – get a home value report from us here www.Evaluate-My-Home.com

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