Tag Archives: real estate bubble

Zillow Q3 2018 Home Price Expectations Survey – Summary & Comments

On August 28, 2018, the Zillow Q3 2018 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

An excerpt from the press release:

Annual home-value appreciation has been faster in 2018 than it was in 2017, and inventory has fallen on a year-over-year basis for 42 consecutive months. These conditions have put sellers in the driver’s seat for the past few years.

Recently, though, data suggest the balance may be starting to tilt back toward buyers. Home-value growth is slowing in more than half of the nation’s 35 largest metros, and price cuts are becoming more common. But even in those markets where appreciation has slowed, it remains above its historic average rate and sellers continue to have the upper hand, particularly at the most affordable price points. Three out of four economists surveyedii said the national housing market would not shift to a buyers market until 2020 or later.

Various Q3 2018 Zillow Home Price Expectations Survey charts are available, including that seen below:

U.S. Home Price Expectations chart

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q3 2018 Home Price Expectations Survey (pdf) is interesting.  Of the 115 survey respondents, only three (of the displayed responses) forecasts a cumulative price decrease through 2022, and none of those forecasts is for a double-digit percentage decline.   The largest decline is seen as a 3.4% cumulative price decrease through 2022.

The Median Cumulative Home Price Appreciation for years 2018-2022 is seen as 6.00%, 10.45%, 13.82%, 16.64%, and 19.80%, respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in the above-referenced forecast) will prove far too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2897.87 as this post is written

Zillow Q2 2018 Home Price Expectations Survey – Summary & Comments

On May 22, 2018, the Zillow Q2 2018 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

An excerpt from the press release:

In the meantime, experts think the housing market will continue to experience strong appreciation. They predict U.S. home values will rise 5.5 percent in 2018 to a median of $220,800. At this time last year, predictions were for home values to rise 3.7 percent in 2018.

“Constrained home supply, persistent demand, very low unemployment, and steady economic growth have given a jolt to the near-term outlook for U.S. home prices,” said Pulsenomics founder, Terry Loebs. “These conditions are overshadowing concerns that mortgage rate increases expected this year might quash the appetite of prospective home buyers.”

Various Q2 2018 Zillow Home Price Expectations Survey charts are available, including that seen below:

Zillow U.S. Home Price Expectations

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q2 2018 Home Price Expectations Survey (pdf) is interesting.  Of the 100+ survey respondents, only five (of the displayed responses) forecasts a cumulative price decrease through 2022, and none of those forecasts is for a double-digit percentage decline.   The largest decline is seen as a 7.86% cumulative price decrease through 2022.

The Median Cumulative Home Price Appreciation for years 2018-2022 is seen as 5.75%, 10.24%, 13.53%, 16.75%, and 20.46%, respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in the above-referenced forecast) will prove far too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2724.44 as this post is written

Zillow Q1 2018 Home Price Expectations Survey – Summary & Comments

On February 20, 2018, the Zillow Q1 2018 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

An excerpt from the press release:

The quarterly survey, sponsored by Zillow and conducted by Pulsenomics LLC, asked more than 100 housing experts and economists about their expectations for home price growth, and whether tax reform affected these predictions.

When asked how the new tax law impacted their five-year forecast for home values in the U.S., 41 percent of respondents said their overall housing outlook is now more pessimistic, while 31 percent of the panelists had a more optimistic view as a result of the tax reform. The remaining 28 percent of respondents said that tax reform did not change their outlook.

Various Q1 2018 Zillow Home Price Expectations Survey charts are available, including that seen below:

Zillow U.S. Home Price Expectations

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q1 2018 Home Price Expectations Survey (pdf) is interesting.  Of the 105 survey respondents, only three (of the displayed responses) forecasts a cumulative price decrease through 2022, and none of those forecasts is for a double-digit percentage decline.   The largest decline is seen as a 4.5% cumulative price decrease through 2022.

The Median Cumulative Home Price Appreciation for years 2018-2022 is seen as 5.00%, 9.10%, 12.49%, 15.85%, and 19.33%, respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in the above-referenced forecast) will prove far too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2701.33 as this post is written

Zillow Q4 2017 Home Price Expectations Survey – Summary & Comments

On December 5, 2017, the Zillow Q4 2017 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

An excerpt from the press release:

Panelists views on the pace of home value growth have consistently grown over the past several quarters, likely because of low mortgage rates spurring demand and low inventory constricting supply – a recipe for rapid home value growth that has been in place for the past several years. On average, panelists said they expect home values to end this year up 5.6 percent from the end of 2016 (as of October 2017, median U.S. home values were up 6.5 percent year-over-year. Panelists said they expected home values to end 2018 up 4.13 percent from the end of this year, on average. At the end of 2016, the same panelists said they expected home values to end 2017 up 3.61 percent and 2018 up just 2.97 percent year-over-year, on average.

Various Q4 2017 Zillow Home Price Expectations Survey charts are available, including that seen below:

U.S. Home Price Expectations

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q4 2017 Home Price Expectations Survey (pdf) is interesting.  Of the 100+ survey respondents, only two (of the displayed responses) forecasts a cumulative price decrease through 2022, and only one of those forecasts is for a double-digit percentage decline.  That forecast is from Mark Hanson, who foresees a 20.52% cumulative price decrease through 2021.

The Median Cumulative Home Price Appreciation for years 2017-2022 is seen as 5.60%, 10.25%, 13.65%, 17.13%, 20.55%, and 24.34%, respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in Mark Hanson’s above-referenced forecast) will prove too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2629.20 as this post is written

Zillow Q3 2017 Home Price Expectations Survey – Summary & Comments

On August 21, 2017, the Zillow Q3 2017 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

An excerpt from the press release:

The panelists expect a future recession to have a moderate impact on the U.S. housing market overall, but some markets are more at risk than others. More than 60 percent of experts say the next recession will have a major impact on the San Francisco and Miami housing markets, and at least half predict a major impact in Los Angeles and New York as well.

Various Q3 2017 Zillow Home Price Expectations Survey charts are available, including that seen below:

U.S. Home Price Expectations chart

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q3 2017 Home Price Expectations Survey (pdf) is interesting.  Of the 100+ survey respondents, only five (of the displayed responses) forecasts a cumulative price decrease through 2021, and only one of those forecasts is for a double-digit percentage decline.  That forecast is from Mark Hanson, who foresees a 24.47% cumulative price decrease through 2021.

The Median Cumulative Home Price Appreciation for years 2017-2021 is seen as 5.00%, 9.22%, 13.01%, 16.22%, and 19.33%, respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in Mark Hanson’s above-referenced forecast) will prove too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2425.73 as this post is written

Zillow Q2 2017 Home Price Expectations Survey – Summary & Comments

On May 31, 2017, the Zillow Q2 2017 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

Two excerpts from the Press Release:

Expectations for overall home price growth are stronger now than they were a year ago. A year ago, panelists predicted that home prices would rise 3.4 percent in 2017. Now, they expect to see a 4.8 percent increase. Their forecasts for home price growth in 2018 are also more optimistic now compared to last year.

also:

“On the heels of last year’s nearly seven percent national home value appreciation rate, the prospect that prices will increase less than five percent overall this year might be dispiriting to some,” said Pulsenomics founder Terry Loebs. “Yet, 4.8 percent is not only well above the historical average annual gain, it’s the most optimistic projection for 2017 that we’ve seen from our expert panel over the past five years. Although most pessimistic experts still expect a sharp slowdown to commence in 2018, even this group anticipates home values to increase an average of nearly four percent this year. Given these projections, it’s a pretty safe bet that U.S. home equity growth will exceed $1 trillion for the sixth consecutive year, and continue to buttress consumer confidence and household spending in 2017, especially if more of today’s renters can afford the transition to homeownership.”

Various Q2 2017 Zillow Home Price Expectations Survey charts are available, including that seen below:

U.S. Home Price Expectations chart

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q2 2017 Home Price Expectations Survey (pdf) is interesting.  Of the 100+ survey respondents, only six (of the displayed responses) forecasts a cumulative price decrease through 2021, and only one of those forecasts is for a double-digit percentage decline.  That forecast is from Mark Hanson, who foresees a 24.47% cumulative price decrease through 2021.

The Median Cumulative Home Price Appreciation for years 2017-2021 is seen as 5.00%, 9.22%, 12.49%, 15.69%, and 18.76%, respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in Mark Hanson’s above-referenced forecast) will prove too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2408.37 as this post is written

Zillow Q1 2017 Home Price Expectations Survey – Summary & Comments

On February 10, 2017, the Zillow Q1 2017 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

Two excerpts from the Press Release:

The quarterly survey, sponsored by Zillow and conducted by Pulsenomics LLC, asked more than 100 housing experts and economists what factors would have the greatest impact on U.S. housing this year. The most frequent answer was rising mortgage rates and their impact on mortgage affordability, with more than half of panelists selecting itii.

also:

Home values rose 6.8 percent in 2016. Overall, the experts surveyed predict home prices will rise 4.6 percent in 2017, then slow to 3 percent annual growth by 2019.

“Compared to their outlook in our previous survey just a few months ago, most of our panelists now expect somewhat stronger home value appreciation this year and next, as tight inventory conditions persist,” said Pulsenomics founder Terry Loebs. “However, longer-term, the consensus still calls for decelerating prices, with the most pessimistic quartile of experts continuing to project negative inflation-adjusted returns for U.S. housing beyond 2017. The specter of rising mortgage rates and other affordability hurdles are clearly impacting these home value projections.”

Various Q1 2017 Zillow Home Price Expectations Survey charts are available, including that seen below:

Zillow U.S. Home Price Expectations survey chart

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q1 2017 Home Price Expectations Survey (pdf) is interesting.  Of the 100+ survey respondents, only six (of the displayed responses) forecasts a cumulative price decrease through 2021, and only one of those forecasts is for a double-digit percentage decline.  That forecast is from Mark Hanson, who foresees a 22.97% cumulative price decrease through 2021.

The Median Cumulative Home Price Appreciation for years 2017-2021 is seen as 4.55%, 8.68%, 11.82%, 14.70%, and 18.02% respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in Mark Hanson’s above-referenced forecast) will prove too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2314.75 as this post is written

Zillow Q4 2016 Home Price Expectations Survey – Summary & Comments

On December 6, 2016, the Zillow Q4 2016 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

An excerpt from the Press Release:

Overall, the experts surveyed – which include economists and researchers — said they expect home price appreciation to be at almost 5 percent by the end of 2016, and slow down to 3.6 percent by the end of next year. Zillow forecasts rents across the U.S. to appreciate 1.6 percent from October 2016 to October 2017.

“More than 90 percent of the 111 panelists who participated in this quarter’s survey expect home value growth to be slower next year, and more than 85 percent of them foresee home value appreciation rates flat or lower compared to 2016 in every year through 2021,” said Pulsenomics founder Terry Loebs.  “While those figures represent a clear consensus that home value growth will moderate in the coming years, there is no consensus concerning the pace of the expected deceleration.  For example, the most optimistic experts project that U.S. home value appreciation will average more than 4 percent annually through 2021, while the most pessimistic expect an average annual rate of just 1.1 percent for 2017 and beyond.”

Various Q4 2016 Zillow Home Price Expectations Survey charts are available, including that seen below:

Zillow U.S. Home Price Expectations chart

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q4 2016 Home Price Expectations Survey (pdf) is interesting.  Of the 111 survey respondents, only two (of the displayed responses) forecasts a cumulative price decrease through 2021, and only one of those two forecasts is for a double-digit percentage decline.  That forecast is from Mark Hanson, who foresees a 24.47% cumulative price decrease through 2021.

The Median Cumulative Home Price Appreciation for years 2016-2021 is seen as 4.90%, 8.88%, 12.24%, 15.30%, 18.76%, and 22.32% respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in Mark Hanson’s above-referenced forecast) will prove too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2212.23 as this post is written

Zillow Q3 2016 Home Price Expectations Survey – Summary & Comments

On August 10, 2016, the Zillow Q3 2016 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

An excerpt from the Press Release:

Overall, the experts surveyed predict home price appreciation across the country will be up over 4 percent year-over-year by the end of 2016. They expect home prices to slow down over the next four years and by the end of 2020, they predict home prices will grow at an annual pace of just 2.9 percent.

“Panel-wide, the experts currently expect U.S. home values to finish 2016 with a healthy 4.5 percent year-over-year gain,” said Pulsenomics founder Terry Loebs. “This projection implies a somewhat cooler, but still solid, second half of the year. Although further price moderation is expected next year, nearly 90 percent of the panel is projecting lower home value gains in 2017. The longer-run outlook for housing market performance remains steady. Overall, the expected five-year average annual growth rate for home values actually rose, albeit slightly, for the first time in three years.”

Various Q3 2016 Zillow Home Price Expectations Survey charts are available, including that seen below:

Zillow Q3 2016 U.S. Home Price Expectations chart

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q3 2016 Home Price Expectations Survey (pdf) is interesting.  Of the 100+ survey respondents, only one (of the displayed responses) forecasts a cumulative price decrease through 2020.  That forecast is from Mark Hanson, who foresees a 15.58% cumulative price decrease through 2020.

The Median Cumulative Home Price Appreciation for years 2016-2020 is seen as 4.50%, 8.47%, 11.94%, 14.75%, and 18.58%, respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in Mark Hanson’s above-referenced forecast) will prove too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2176.80 as this post is written

Zillow Q2 2016 Home Price Expectations Survey – Summary & Comments

On May 18, 2016, the Zillow Q2 2016 Home Price Expectations Survey results were released.  This survey is done on a quarterly basis.

Two excerpts from the Press Release:

Overall, the economists surveyed predicted home price appreciation would be up 4 percent year-over-year at the end of 2016, higher than predictions of 3.7 percent indicated in the previous survey. However, if Sanders or Trump is elected, the economists would lower their expectations both for home values and the overall performance of the U.S. economy.

also:

“Longer-term expectations for U.S. home values continue to trend slowly downward, and are at the lowest levels they’ve been since the market recovery began four years ago,” said Pulsenomics founder Terry Loebs. “After adjusting for expected inflation, the expert panel’s forecast for national home value appreciation averages 1.7 percent annually through 2020.” Although this would mark a significant pull-back from the 3.6 percent inflation-adjusted average annual rate experienced since the start of the recovery in 2012, Loebs said that housing market stakeholders should keep the fading optimism in perspective. “During most of the decade that preceded the onset of the real estate bubble more than fifteen years ago–a relatively normal period for the U.S. housing market–nominal home values didn’t even keep up with inflation.”

Various Q2 2016 Zillow Home Price Expectations Survey charts are available, including that seen below:

Zillow Home Price Expectations

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the U.S. Zillow Home Value Index, will continually climb.

The detail of the Q2 2016 Home Price Expectations Survey (pdf) is interesting.  Of the 100+ survey respondents, only one (of the displayed responses) forecasts a cumulative price decrease through 2020.  That forecast is from Mark Hanson, who foresees a 14.77% cumulative price decrease through 2020.

The Median Cumulative Home Price Appreciation for years 2016-2020 is seen as 4.00%, 7.64%, 11.14%, 14.31%, and 17.97%, respectively.

For a variety of reasons, I continue to believe that even the most “bearish” of these forecasts (as seen in Mark Hanson’s above-referenced forecast) will prove too optimistic in hindsight.  From a longer-term historical perspective, such a decline is very mild in light of the wild excesses that occurred over the “bubble” years.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Furthermore, from these price levels there exists outsized potential for a price decline of severe magnitude, unfortunately.  I discussed this downside, based upon historical price activity, in the October 24, 2010 post titled “What’s Ahead For The Housing Market – A Look At The Charts.”

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2047.63 as this post is written