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Veros Sees Strength in Texas Home Values, Declines for Florida, Nevada

September 28, 2010

Veros Sees Strength in Texas Home Values, Declines for Florida, Nevada
09/27/2010 By: Carrie Bay

The Texas metro areas of Houston and Dallas show the strongest home price appreciation over the next 12 months in the most recent update to the U.S. real estate market forecast from Veros Real Estate Solutions.

The California-based risk management and valuation service provider says its analysis shows Texas cities leading the nation, with home prices in these areas expected to post the biggest gains in the months ahead.

Meanwhile, Florida home markets continue to struggle as the state placed four metro areas in the rankings of the five projected weakest markets in Veros’ forecast. The Las Vegas and Reno metros also made the weakest-markets list. The company says key markets in Florida and Nevada will likely see home prices drop another 6-7 percent over the next year.

“Texas is looking strong, with four of the top ten markets in the appreciation forecast,” said Eric Fox, Veros’ VP of statistical and economic modeling.

Fox added that California markets are less robust than in previous quarterly updates, but remain steady, with the Riverside/San Bernardino market faring the best in the state due to affordability and seasonal trends. He also noted that Anchorage, Alaska is showing modest gains, as are the Central Plains areas of Illinois and Iowa.

Veros called its home price forecasts for certain states in the central Great Plains region “especially good.” These
hallmarks of appreciation include Texas, Louisiana, Missouri, Iowa, Arkansas, Oklahoma, Nebraska, and South Dakota.

Projected Five Strongest Markets

1.Houston/Sugar Land/Baytown, Texas +3.8%
2.Dallas/Fort Worth/Arlington, Texas +2.7%
3.Amarillo, Texas +2.7%
4.Anchorage, Alaska +2.7%
5.Davenport/Moline/Rock Island, Iowa-Illinois +2.7%

In marked contrast to the forecast for Texas, the outlook for Florida remains weak, but Fox says there is some improvement in negative growth markets in the Sunshine State.

“For example, the Daytona area was at -8.3 percent last quarter and this forecast shows an improved change to -6.0 percent,” Fox explained. “There are more Florida communities on the weakest market list this time, but they appear to be depreciating at a reduced rate.”

Projected Five Weakest Markets

1.Port St. Lucie/Fort Pierce, Florida -7.2%
2.Reno/Sparks, Nevada -7.0%
3.Orlando/Kissimmee, Florida -6.3%
4.Las Vegas/Paradise, Nevada -6.1%
5.Deltona/Daytona/Ormond Beach, Florida -6.0%

“Approximately one-third of the markets forecast are expected to appreciate in the next 12 months, and two-thirds are expected to depreciate,” Fox said. “In the longer 12- to 24-month horizon, we anticipate this ratio to even out to 50-50, with half appreciating gently and half depreciating similarly.”

According to Fox, “There are tangible indications that things are getting better as time moves on.”

Veros’ utilizes more than 50 critical decisioning factors in its forecast analytics to develop market trend predictions covering more than 900 counties, more than 300 metro areas, and nearly 14,000 ZIP codes. Key factors range from interest, unemployment, and inflation rates, to housing inventory levels, as well as economic and geographic trends.

From: http://www.dsnews.com/articles/veros-sees-strength-in-texas-home-values-declines-for-florida-and-nevada-2010-09-27

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