If you’re considering buying a home, you want to ensure it’s a wise financial decision. One key factor to consider is the projected trend of home prices in the coming years and how that could impact your investment.
While this year hasn’t seen a significant drop in home prices, certain markets may see fluctuations throughout the year. It’s important to keep a long-term perspective. Experts predict that in the following years, home prices will return to a more stable rate of appreciation.
Anticipated Home Price Appreciation Pulsenomics’ latest quarterly Home Price Expectation Survey (HPES) gathered insights from over 100 economists, investment strategists, and housing market analysts. The report shows what these experts believe will happen with home prices over the next five years. As illustrated in the graph below, after mild depreciation this year, the experts anticipate a return to a more normal level of home price appreciation through 2027.
The key takeaway is that experts aren’t predicting a significant nationwide drop in home prices, though some markets may experience depreciation while others may appreciate. When looking further ahead, they expect a steady rise in home prices over time. This is why homeownership is an excellent long-term investment.
What this means for you purchasing a home results in appreciation of its value, which contributes to your household’s wealth. The graph below shows how a typical home’s value could change over the next several years based on the expert price appreciation projections from the survey mentioned above.
Using this example, if you bought a $400,000 home at the beginning of the year and factored in the HPES forecast, you could accumulate over $54,000 in household wealth over the next five years. This is a great example of why owning a home is a smart investment over the long haul.
The bottom line according to the experts, while there may be slight depreciation in home prices this year, they’re expected to rise over the next five years. If you’re ready to invest in homeownership, know that buying a home today can lead to long-term success as home values (and your own net worth) are expected to increase. Let’s connect to start the homebuying process today.