If you are in the process of buying a home, it is important to take into account the projections made by experts regarding future home prices and how these projections may impact your investment. Despite negative reports in the past year, home prices have actually been performing better than anticipated and are experiencing a nationwide increase. In addition, data indicates that experts predict a continued appreciation of home prices.

Experts Project Ongoing Appreciation

In the recent quarterly Home Price Expectation Survey (HPES) conducted by Pulsenomics, more than 100 economists, investment strategists, and housing market analysts were polled to gather their insights on home prices over the next five years. The survey results reveal the expert projections, indicating that home prices are expected to increase annually until 2027. Please refer to the graph below for a visual representation of these forecasts.

For those who have concerns about falling home prices based on online articles, it is important to note that experts predict a continued rise in home prices across the country for the foreseeable future, although variations may exist in local markets. These projections indicate a return to more normal levels of home price appreciation.

It is worth noting that while the projected increase in 2024 may not be as substantial as in 2023, it is crucial to understand that home price appreciation is cumulative. In other words, if the experts' predictions hold true, after experiencing a 3.32% increase in your home's value this year, it is expected to appreciate by an additional 2.17% the following year. This serves as a compelling example of why owning a home is a long-term investment that yields significant benefits over time.

What Does This Mean for You?

After purchasing a home, price appreciation plays a significant role in increasing the value of your property, thereby contributing to the growth of your household wealth. To gain insights into how the value of a typical home may evolve in the coming years, you can refer to the graph below, which showcases the expert projections from the Home Price Expectation Survey (HPES).

Suppose you purchased a home worth $400,000 at the start of this year. Taking into account the projections from the Home Price Expectation Survey (HPES), it is estimated that over the next five years, you could potentially accumulate more than $71,000 in household wealth. Considering this example, it becomes evident that buying a home can serve as a powerful means to grow your wealth in the long term.

Bottom Line

Based on expert projections, it is anticipated that home prices will experience a more moderate growth rate over the next five years. If you are prepared to embark on the journey of becoming a homeowner, it is worth noting that purchasing a home at this time can position you for long-term success as home values increase, subsequently contributing to the growth of your own net worth. To initiate the homebuying process, I encourage you to reach out to a local real estate agent who can provide guidance and assistance tailored to your specific needs.