In the monthly REALTORS® Confidence Index Survey, the National Association of REALTORS® asks members “In the neighborhood or area where you make most of your sales, what are your expectations for residential property prices over the next year?”
The map below shows the median expected price change of the respondents in the next 12 months at the state level for surveys conducted in August—October 2017, according to the October 2017 REALTORS® Confidence Index Survey. REALTOR® respondents from Washington and Nevada expected the highest price growth, with the median expected price growth at more than five to six more percent . In Colorado, Florida, and Delaware, the median expected price growth was four to five percent.
The median expected price change has been trending upwards in Washington and Nevada. In Washington, the median price expectation among REALTORS® has increased from around four percent in 2015 to around six to seven percent in 2017. In Nevada, the home price expected growth has edged up to six to seven percent range since 2017 from four to five percent in 2014–2016. Colorado exhibits a wide seasonal fluctuation in prices, but the long-term trend has hovered at around five percent. Meanwhile, given the strong price growth in Florida and California since 2012, respondents expect home price growth to moderate to about four percent.
The tight supply has led to higher price growth. Nationally, the inventory of existing and new homes for sale stood at 2.81 million in September 2017, which, at the current level of demand (sales), will be exhausted in 4.3 months. Historical data since January 2000 indicates shows the median price of existing homes tended to appreciate above five percent when months’ supply fell below six months, while home prices fell by at least ten percent when months’ supply rose to ten months or more in 2010. To increase the number of observations for each state, NAR uses data from the last three surveys.
Source: Economic Research