Map: Zillow's latest home price forecast for America's largest housing markets

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Last month, economists at Zillow issued a big revision, predicting that over the next 12 months, U.S. home prices would rise +3.5% instead of their previous forecast of -0.1%.

This week, Zillow economists issued another upward revision. Well, a slight upward revision.

Heading forward, Zillow’s forecast model expects U.S. home prices to rise +4.2% between January 2024 and January 2025.

Click here to view an interactive version of the map below

In a note published on Thursday, Zillow senior economist Orphe Divounguy explained their take on the 2024 housing market.

“Housing affordability remains the biggest challenge for many existing homeowners and potential homebuyers. Mortgage rates soared to the highest level in 23 years in October before easing at the end of the year. However, easing mortgage rates at the end of the year brought buyers – and some sellers – back into the market. The flow of existing homes onto the for-sale market has continued to improve on a year-over-year basis. Zillow data shows new listings are now up 6% while the number of homes for sale has also increased by 3% when compared to a year ago. The housing market was supply constrained in 2023 and the increase in supply bodes well for potential home buyers and housing sales this spring,” wrote Divounguy.

Divounguy added that: “Despite these [supply/listing] improvements, the housing market remains supply constrained. The lack of existing homes on the market provides an opportunity for builders to fill the gap. Builders are offering incentives such as rate buy-downs to make the math work for prospective buyers.”

In other words, Zillow believes the fact that “months of supply” remains under 6 months will keep upward pressure on existing home prices this year in most markets.

Want more home price forecasts? We recently did a round up of 15 forecast models for ResiClub PRO members.

Yesterday, ResiClub hosted a webinar to discuss our view on the current state of the U.S. housing market. To support our analysis, we presented 48 charts.

You can watch the webinar recording here.

Nothing in this newsletter is investment advice. Please do your own research.

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