Data from more than 380 U.S. markets indicated that the housing recovery will continue to gain momentum, with home prices projected to grow 3.3 percent from the third quarter of 2012 to the third quarter of 2017, according to the Fiserv Case-Shiller Indexes released March 4.
The report noted that home prices and sales volumes experienced a steady increase during the past year, making 2012 the first positive year for both of these metrics since the peak of the housing crisis. The report also predicted that home prices would increase 0.6 percent over the next 12-month period.
“2012 was the first year since 1997 that the housing market has resembled something recognizable as normal,” David Stiff, chief economist for Fiserv, said in a news release. “From 1998 to 2006, prices appreciated at levels above 5 percent, with double-digit price increases in many of those years. Then, after 2006, the market collapsed as euphoria turned to panic. It took until the end of 2011 before housing markets finally started to stabilize. The latest Case-Shiller results show a return to a historically normal pace of price appreciation in the last year.”
Fiserv noted that home prices increased in approximately 62 percent of all U.S. metro areas during the third quarter of 2012 compared to 12.5 percent in the same period a year before. The nation’s average home price increased 3.6 percent from the third quarter of 2011 to the comparable period of 2012.
Fiserv projected that by the end of 2013, home prices would rise in nearly every metro area in the nation. Some markets may see short-term double-digit price jumps that partially could be reversed by price declines as large divisions of bank-owned inventory are settled — but price appreciation gradually will return to normal rates as home buyers regain confidence in the market recovery.
See additional Fiserv Case-Shiller data.