In its 12-month home price forecast issued Wednesday, Veros Real Estate Solutions said it had “continued bad news for Florida.” Markets in the Sunshine State claimed
the top five spots on the collateral valuation company’s list of areas where prices are expected to drop the most over the next year.
The Deltona-Daytona Beach-Ormond Beach market has the farthest to fall when it comes to price depreciation. There, Veros projects prices will plunge another 10 percent between now and March 2011.
In Palm Bay-Melbourne-Titusville, the forecast is a decline of 8.9 percent. Naples-Marco Island will likely see prices drop another 8.8 percent, Veros says. The company expects Orlando-Kissimmee to suffer price depreciations of 8.7 percent over the next year. And Port St. Lucie-Fort Pierce is projected to see a decline of 8.6 percent.
Eric Fox, Veros’ VP of statistical and economic modeling, said, “Florida remains ground zero for the weakest home price forecasts in the U.S. although extreme declines of 20 or 25 percent are no longer expected since strong price corrections have already occurred.”
One of the other big bust states – California – shows more promise, according to Veros’ analysis. The Golden State is home to three of the five markets the company expects to post the strongest price gains over the next 12 months.
Veros projects home prices in the San Diego-Carlsbad-San Marcos market to increase by 3.4 percent between now and March 2011. In Los Angeles-Long Beach-Santa Ana, the company forecasts a rise of 3.1 percent, and San Francisco-Oakland-Fremont is expected to see price gains of 3.0 percent.
“More of California’s coastal areas are showing modest signs of appreciation,” Fox said, noting that Los Angeles and San Francisco were not among the top five for price gains in the company’s study last quarter, but have edged their way up the ranks over the past three months.
Two Texas metro areas also made the “strongest markets” list, with prices in Houston-Sugarland-Baytown expected to see gains of 3.0 percent over the next year, and prices in Amarillo forecast to increase 2.7 percent.
“The Great Plains region including Texas remains steady,” Fox said.
Addressing the overall picture, Fox added, “Although there are no overwhelmingly strong appreciating forecasts among the larger metropolitan areas, the depreciating forecasts are noticeably milder than a year ago.”
Veros says it anticipates “gradual improvement” of property value trends in key markets over the next 12 months.
The company’s predictions are based on its analysis of more than 900 counties, nearly 300 metro areas, and almost 14,000 zip codes, encompassing such critical factors as interest, unemployment, and inflation rates; housing inventory levels; and economic and geographic trends.
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