Will Home Values Appreciate or Depreciate in 2020?

Dated: May 18 2020

Views: 6

Will Home Values Appreciate or Depreciate in 2020? | MyKCM

With the housing market staggered to some degree by the health crisis the country is currently facing, some potential purchasers are questioning whether home values will be impacted. The price of any item is determined by supply as well as the market’s demand for that item.

Each month the National Association of Realtors (NAR) surveys “over 50,000 real estate practitioners about their expectations for home sales, prices and market conditions” for the REALTORS Confidence Index.

Their latest edition sheds some light on the relationship between seller traffic (supply) and buyer traffic (demand) during this pandemic.

Buyer Demand

The map below was created after asking the question: “How would you rate buyer traffic in your area?”Will Home Values Appreciate or Depreciate in 2020? | MyKCMThe darker the blue, the stronger the demand for homes is in that area. The survey shows that in 34 of the 50 U.S. states, buyer demand is now ‘strong’ and 16 of the 50 states have a ‘stable’ demand.

Seller Supply

The index also asks: “How would you rate seller traffic in your area?”Will Home Values Appreciate or Depreciate in 2020? | MyKCMAs the map above indicates, 46 states and Washington, D.C. reported ‘weak’ seller traffic, 3 states reported ‘stable’ seller traffic, and 1 state reported ‘strong’ seller traffic. This means there are far fewer homes on the market than what is needed to satisfy the needs of buyers looking for homes right now.

With demand still stronger than supply, home values should not depreciate.

What are the experts saying?

Here are the thoughts of three industry experts on the subject:

Ivy Zelman:

“We note that inventory as a percent of households sits at the lowest level ever, something we believe will limit the overall degree of home price pressure through the year.”

Mark Fleming, Chief Economist, First American:

“Housing supply remains at historically low levels, so house price growth is likely to slow, but it’s not likely to go negative.”

Freddie Mac:

“Two forces prevent a collapse in house prices. First, as we indicated in our earlier research report, U.S. housing markets face a large supply deficit. Second, population growth and pent up household formations provide a tailwind to housing demand.”

Bottom Line

Looking at these maps and listening to the experts, it seems that prices will remain stable throughout 2020. If you’re thinking about listing your home, let’s connect to discuss how you can capitalize on the somewhat surprising demand in the market now.

Blog author image

Linda and Richard Askue

We Want to Become your Real Estate Agents for Life! We have a highly successful Team of Real Estate Professionals. If you’re looking to buy or sell a home in the North Atlanta, GA area let us help ....

Latest Blog Posts

Can You Be That Morning Person Tomorrow?

Ever wish you could become one of those rare morning people? The ones that wake with a start, feeling refreshed and energized. The ones that get in that morning workout or wrap up some work before

Read More

Things to Avoid after Applying for a Mortgage

Things to Avoid after Applying for a MortgageSome HighlightsThere are a few key things to make sure you avoid after applying for a mortgage to help make sure you still qualify for your

Read More

Why Right Now May Be the Time to Sell Your House

Why Right Now May Be the Time to Sell Your HouseThe housing market made an incredible recovery in 2020 and is now positioned for an even stronger year in 2021. Record-low mortgage interest&

Read More

4 Reasons People Are Buying Homes in 2021

4 Reasons People Are Buying Homes in 2021According to many experts, the real estate market is expected to continue growing in 2021, and it’s largely driven by the lasting impact the

Read More