SANTA CLARA, Calif., Nov. 30, 2016 /PRNewswire/ -- The 2017
housing market will be a year of slowing, yet moderate growth, set against the backdrop of a changing composition of home buyers
and a post-election interest rate jump that could potentially price some first-timers out of the market, according to the
realtor.com® 2017 housing forecast released today.
The report also predicts the top five housing trends of 2017, as well as home prices and sales for the 100 largest metros in
the U.S. Realtor.com® is a leading online real estate
destination operated by News Corp [NASDAQ: NWS, NWSA]; [ASX: NWS, NWSLV] subsidiary Move, Inc.
2017 national housing forecast
The 2017 national real estate market is predicted to slow compared to the last two years, across the majority of
economic indicators. Home prices are anticipated to increase 3.9 percent and existing home sales are forecasted to increase 1.9
percent to 5.46 million homes. Interest rates are expected to reach 4.5 percent due to higher expectations for inflationary
pressure in the year ahead.
Realtor.com® is forecasting the homeownership rate will stabilize at 63.5 percent after bottoming at 62.9 percent in 2016. New
home sales are expected to grow 10 percent, while new home starts are expected to increase 3 percent. The forecast is based on
GDP growth of 2.1 percent, a 2.5 percent increase in the consumer price index and unemployment declining to 4.7 percent by the
end of the year.
Prior to this month's election, demographics and an improving economy were laying the foundation for a substantial increase in first-time buyers in 2017, but due to mortgage rate increases over the last few weeks
realtor.com® predicts first timers will face new hurdles as they navigate the qualification and buying process. These higher
rates are associated with anticipation of stronger economic and wage growth next year, both of which favor buyers. However,
higher rates will make qualifying for a mortgage and finding affordable inventory more challenging.
"We don't expect the outcome of the election to have a direct impact on the health of the housing market or economy as we
close out 2016. However, the 40 basis points increase in rates in the days following the election has caused us to increase our
interest rate prediction for next year," said Jonathan Smoke, chief economist for realtor.com®.
"With more than 95 percent of first-time home buyers dependent on financing their home purchase, and a majority of first-time
buyers reporting one or more financial challenges, the uptick we've already seen may price some first-timers out of the
market."
Top Housing Trends for 2017
Next year's predicted slowing price and sales growth, increasing interest rates and changing buyer demographics are
setting the stage for five key housing trends:
- Millennials and boomers will dominate the market –– Next year, the housing market will be in the middle
of two massive demographic waves, millennials and baby boomers – that will power demand for at least the next 10 years.
Although increasing interest rates have prompted realtor.com® to lower its prediction of millennial market share to 33 percent
of the buyer pool; millennials and baby boomers will still comprise the majority of the market. Baby boomers are expected to
make up 30 percent of buyers in 2017 and given they're less dependent on financing, they are anticipated to be more successful
when it comes to closing.
- Midwestern cities will continue to be hotbeds for millennials – Midwestern cities are anticipated to
continue to beat the national average in millennial purchase market share in 2017 with Madison,
Wis.; Columbus, Ohio; Omaha, Neb.; Des Moines, Iowa; and Minneapolis, leading the pack. This year, average
millennial market share in these markets is 42 percent, far higher than the U.S. average of 38 percent. With strong
affordability in 15 of the 19 largest Midwestern markets, realtor.com® expects this trend to continue in 2017 even
as interest rates increase.
- Slowing price appreciation – Nationally, home prices are forecast to slow to 3.9 percent growth year over
year, from an estimated 4.9 percent in 2016. Of the top 100 largest metros in the country, 26 markets are expected to see price
acceleration of 1 percent point or more with Greensboro-High Point,
N.C.; Akron, Ohio; and Baltimore-Columbia-Towson, Md., experiencing the largest gains. Likewise, 46
markets are expected to see a slowdown in price growth of 1 percent or more with Lakeland-Winter Haven, Fla., Durham-Chapel Hill, N.C.; and Jackson,
Miss., undergoing the biggest shift to slower price appreciation.
- Fewer homes on the market and fast moving markets – Inventory is currently down an average of 11
percent in the top 100 metros in the U.S. The conditions that are limiting home supply are not expected to change in 2017.
Median age of inventory is currently 68 days in the top 100 metros, which is 14 percent – or 11 days – faster than U.S.
overall.
- Western cities will continue to lead the nation in prices and sales – Western metros in the U.S. are
forecast to see a price increase of 5.8 percent and sales increase of 4.7 percent, much higher than the U.S. overall. These
markets also dominate the ranking of the realtor.com® 2017 top housing markets, making up five of the top 10 markets on the
list (Los Angeles, Sacramento and Riverside, Calif., Tucson, Ariz., and Portland,
Ore.) and 11 of the top 25 (Colorado Springs, Colo.; San
Diego; Salt Lake City; Provo-Orem, Utah; Seattle. and Oxnard-Thousand Oaks-Ventura,
Calif.)
Top 2017 housing markets
Despite a more moderate housing market overall in 2017, strong local economies and population growth will continue to
fuel the nation's top markets. The realtor.com® 2017 top 10 housing markets based on price and sales gains are: 1.
Phoenix-Mesa-Scottsdale,
Ariz.; 2. Los Angeles-Long Beach-Anaheim, Calif.; 3.
Boston-Cambridge-Newton,
Mass.-N.H.; 4. Sacramento--Roseville--Arden-Arcade,
Calif.; 5. Riverside-San Bernardino-Ontario, Calif.; 6. Jacksonville, Fla.; 7. Orlando-Kissimmee-Sanford, Fla.; 8.
Raleigh, N.C.; 9. Tucson, Ariz.; and 10. Portland-Vancouver-Hillsboro,
Ore.-Wash.
These top 10 markets are forecast to see average price gains of 5.8 percent and sales growth of 6.3 percent, exceeding next
year's anticipated national growth of 3.9 percent and 1.9 percent, respectively. But when compared to last year, prices in eight
of the top 10 markets are expected to decelerate with only Los Angeles and Tucson, Ariz. showing stronger growth than last year. Other commonalities among the top 10 housing markets
include: relatively affordable rental prices, low unemployment, large populations of millennials and baby boomers, as well as a
high number of listing views on realtor.com®. See Table 1 for the ranking of the top 100 largest metros in the
U.S., as well as their price and sales forecasts.
Table 1: Realtor.com®'s 2017 Housing Forecast – Top 100 Metros
|
|
Rank
|
MSA
|
Price
|
Sales
|
Rank
|
MSA
|
Price
|
Sales
|
|
1.
|
Phoenix-Mesa-Scottsdale, Ariz.
|
5.9%
|
7.2%
|
51.
|
Greensboro-High Point, N.C.
|
5.5%
|
3.6%
|
|
2.
|
Los Angeles-Long Beach-Anaheim, Calif.
|
6.9%
|
6.0%
|
52.
|
Scranton--Wilkes-Barre--Hazleton, Pa.
|
2.4%
|
6.6%
|
|
3.
|
Boston-Cambridge-Newton, Mass.-N.H.
|
6.1%
|
6.3%
|
53.
|
Tulsa, Okla.
|
4.9%
|
4.0%
|
|
4.
|
Sacramento--Roseville--Arden-Arcade, Calif.
|
7.2%
|
4.9%
|
54.
|
Augusta-Richmond County, Ga.-S.C.
|
4.3%
|
4.6%
|
|
5.
|
Riverside-San Bernardino-Ontario, Calif.
|
5.0%
|
6.9%
|
55.
|
Spokane-Spokane Valley, Wash.
|
4.8%
|
4.0%
|
|
6.
|
Jacksonville, Fla.
|
4.8%
|
7.0%
|
56.
|
Indianapolis-Carmel-Anderson, Ind.
|
3.7%
|
5.0%
|
|
7.
|
Orlando-Kissimmee-Sanford, Fla.
|
5.7%
|
6.1%
|
57.
|
McAllen-Edinburg-Mission, Texas
|
3.6%
|
5.1%
|
|
8.
|
Raleigh, N.C.
|
4.2%
|
7.6%
|
58.
|
Greenville-Anderson-Mauldin, S.C.
|
5.0%
|
3.6%
|
|
9.
|
Tucson, Ariz.
|
6.1%
|
5.5%
|
59.
|
Philadelphia-Camden-Wilmington, Pa.-N.J.-Del.-Md.
|
5.5%
|
3.1%
|
|
10.
|
Portland-Vancouver-Hillsboro, Ore.-Wash.
|
6.6%
|
5.0%
|
60.
|
Atlanta-Sandy Springs-Roswell, Ga.
|
5.9%
|
2.7%
|
|
11.
|
Durham-Chapel Hill, N.C.
|
2.6%
|
9.0%
|
61.
|
Birmingham-Hoover, Ala.
|
4.2%
|
4.3%
|
|
12.
|
Colorado Springs, Colo.
|
4.8%
|
6.7%
|
62.
|
Washington-Arlington-Alexandria, D.C.-Va.-Md.-W.Va.
|
3.9%
|
4.6%
|
|
13.
|
Jackson, Miss.
|
2.0%
|
9.4%
|
63.
|
Worcester, Mass.-Conn.
|
3.5%
|
5.0%
|
|
14.
|
Detroit-Warren-Dearborn, Mich.
|
5.2%
|
6.2%
|
64.
|
Baton Rouge, La.
|
2.9%
|
5.5%
|
|
15.
|
San Diego-Carlsbad, Calif.
|
6.5%
|
4.9%
|
65.
|
Omaha-Council Bluffs, Neb,-Iowa
|
3.7%
|
4.6%
|
|
16.
|
Salt Lake City, Utah
|
6.7%
|
4.7%
|
66.
|
Cape Coral-Fort Myers, Fla.
|
2.9%
|
5.4%
|
|
17.
|
Deltona-Daytona Beach-Ormond Beach, Fla.
|
3.1%
|
8.2%
|
67.
|
Urban Honolulu, Hawaii
|
4.6%
|
3.8%
|
|
18.
|
Provo-Orem, Utah
|
5.2%
|
5.8%
|
68.
|
Oklahoma City, Okla.
|
4.1%
|
4.2%
|
|
19.
|
Austin-Round Rock, Texas
|
3.5%
|
7.4%
|
69.
|
Cleveland-Elyria, Ohio
|
3.6%
|
4.7%
|
|
20.
|
Seattle-Tacoma-Bellevue, Wash.
|
7.4%
|
3.4%
|
70.
|
Virginia Beach-Norfolk-Newport News, Va.-N.C.
|
4.4%
|
3.8%
|
|
21.
|
Charlotte-Concord-Gastonia, N.C.-S.C.
|
4.3%
|
6.3%
|
71.
|
Miami-Fort Lauderdale-West Palm Beach, Fla.
|
4.0%
|
4.2%
|
|
22.
|
Oxnard-Thousand Oaks-Ventura, Calif.
|
5.2%
|
5.4%
|
72.
|
Memphis, Tenn.-Miss.-Ark.
|
3.8%
|
4.2%
|
|
23.
|
New York-Newark-Jersey City, NY-N.J.-Pa.
|
4.0%
|
6.5%
|
73.
|
Harrisburg-Carlisle, Pa.
|
4.9%
|
3.1%
|
|
24.
|
Providence-Warwick, R.I.-Mass.
|
6.3%
|
4.1%
|
74.
|
Palm Bay-Melbourne-Titusville, Fla.
|
4.8%
|
3.1%
|
|
25.
|
North Port-Sarasota-Bradenton, Fla.
|
5.0%
|
5.4%
|
75.
|
Ogden-Clearfield, Utah
|
3.9%
|
4.0%
|
|
26.
|
Denver-Aurora-Lakewood, Colo.
|
6.4%
|
4.0%
|
76.
|
Louisville/Jefferson County, K.-Ind.
|
3.2%
|
4.7%
|
|
27.
|
Pittsburgh, Pa.
|
4.1%
|
6.1%
|
77.
|
St. Louis, Mo.-Ill.
|
3.5%
|
4.4%
|
|
28.
|
Stockton-Lodi, Calif.
|
6.1%
|
4.0%
|
78.
|
Albuquerque, N.M.
|
3.6%
|
4.1%
|
|
29.
|
Houston-The Woodlands-Sugar Land, Texas
|
4.0%
|
6.1%
|
79.
|
Richmond, Va.
|
5.2%
|
2.6%
|
|
30.
|
Boise City, Idaho
|
4.8%
|
5.3%
|
80.
|
Winston-Salem, N.C.
|
2.7%
|
5.1%
|
|
31.
|
Tampa-St. Petersburg-Clearwater, Fla.
|
4.8%
|
5.1%
|
81.
|
Minneapolis-St. Paul-Bloomington, Minn.-Wis.
|
4.1%
|
3.6%
|
|
32.
|
Grand Rapids-Wyoming, Mich.
|
5.8%
|
4.2%
|
82.
|
Des Moines-West Des Moines, Iowa
|
2.9%
|
4.3%
|
|
33.
|
New Orleans-Metairie, La.
|
4.0%
|
5.9%
|
83.
|
Kansas City, Mo.-Kan.
|
4.4%
|
2.7%
|
|
34.
|
Springfield, Mass.
|
4.7%
|
5.1%
|
84.
|
New Haven-Milford, Conn.
|
4.4%
|
2.6%
|
|
35.
|
Bakersfield, Calif.
|
5.3%
|
4.5%
|
85.
|
Columbia, S.C.
|
3.4%
|
3.6%
|
|
36.
|
Las Vegas-Henderson-Paradise, Nev.
|
5.1%
|
4.6%
|
86.
|
Toledo, Ohio
|
4.7%
|
2.1%
|
|
37.
|
San Francisco-Oakland-Hayward, Calif.
|
8.4%
|
1.2%
|
87.
|
El Paso, Texas
|
3.9%
|
2.9%
|
|
38.
|
Cincinnati, OH-KY-IN
|
3.2%
|
6.4%
|
88.
|
Akron, Ohio
|
4.8%
|
1.9%
|
|
39.
|
San Jose-Sunnyvale-Santa Clara, Calif.
|
8.3%
|
1.3%
|
89.
|
Youngstown-Warren-Boardman, Ohio-Pa
|
4.8%
|
1.9%
|
|
40.
|
Lakeland-Winter Haven, Fla.
|
4.6%
|
4.9%
|
90.
|
Little Rock-North Little Rock-Conway, Ark.
|
3.0%
|
3.6%
|
|
41.
|
San Antonio-New Braunfels, Texas
|
3.3%
|
6.2%
|
91.
|
Dayton, Ohio
|
4.3%
|
2.2%
|
|
42.
|
Columbus, Ohio
|
3.8%
|
5.7%
|
92.
|
Wichita, Kan.
|
3.9%
|
2.5%
|
|
43.
|
Fresno, Calif.
|
3.7%
|
5.8%
|
93.
|
Allentown-Bethlehem-Easton, Pa.-N.J.
|
3.1%
|
3.0%
|
|
44.
|
Knoxville, Tenn.
|
3.1%
|
6.3%
|
94.
|
Syracuse, N.Y.
|
3.4%
|
2.6%
|
|
45.
|
Rochester, N.Y.
|
3.1%
|
6.3%
|
95.
|
Baltimore-Columbia-Towson, Md.
|
3.0%
|
2.9%
|
|
46.
|
Charleston-North Charleston, S.C.
|
3.3%
|
6.1%
|
96.
|
Buffalo-Cheektowaga-Niagara Falls, N.Y.
|
3.4%
|
2.1%
|
|
47.
|
Nashville-Davidson--Murfreesboro--Franklin, Tenn.
|
4.9%
|
4.4%
|
97.
|
Albany-Schenectady-Troy, N.Y.
|
1.8%
|
3.5%
|
|
48.
|
Dallas-Fort Worth-Arlington, Texas
|
4.1%
|
5.1%
|
98.
|
Hartford-West Hartford-East Hartford, Conn.
|
4.7%
|
0.4%
|
|
49.
|
Milwaukee-Waukesha-West Allis, Wis.
|
4.7%
|
4.5%
|
99.
|
Bridgeport-Stamford-Norwalk, Conn.
|
1.9%
|
2.6%
|
|
50.
|
Madison, Wis.
|
3.8%
|
5.4%
|
100.
|
Chicago-Naperville-Elgin, Ill.-Ind.-Wis.
|
2.0%
|
2.3%
|
Forward-Looking Statements
This document contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements are based on management's views and assumptions regarding future events and business performance as of
the time the statements are made. Actual results may differ materially from these expectations due to changes in global economic,
business, competitive market and regulatory and other factors. More detailed information about these and other factors that could
affect future results is contained in News Corp's filings with the Securities and Exchange Commission. The "forward-looking
statements" included in this document are made only as of the date of this document and we do not have any obligation to publicly
update any "forward-looking statements" to reflect subsequent events or circumstances, except as required by law.
About realtor.com®
Realtor.com® is the trusted resource for home
buyers, sellers and dreamers, offering the most comprehensive source of for-sale properties, among competing national sites, and
the information, tools and professional expertise to help people move confidently through every step of their home journey. It
pioneered the world of digital real estate 20 years ago, and today helps make all things home simple, efficient and enjoyable.
Realtor.com® is operated by News Corp [NASDAQ: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. under a perpetual
license from the National Association of REALTORS®. For more information, visit realtor.com®.
Media Contact:
Realtor.com®
Lexie Puckett Holbert – lexie.puckett@move.com
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