Generally we expect markets with the strongest recoveries underway to experience moderate growth in 2013, as rising prices bring many markets into alignment with long-run historical norms. Slower growth in markets with robust recoveries underway can be seen as a more mature stage of recovery, rather than a weakness.
Out of the top 50 major metro markets in 2013, Seattle, a market with a strong recovery already underway, is expected to see the highest gains at 13.5%. Unlike other strong performing markets, Seattle is not expected to see a notable moderation of growth. The metro's relatively strong job market is expected, in part, to continue to drive housing gains overall.
Metro markets' underlying price points will continue to dictate trend variability into 2013. We see many lower-priced markets with a higher propensity to shift trends, when measured by percentage change. Birmingham is projected to see the second highest rate of growth out of the top 50 metros, at 10.0% in 2013, with a median price-per-square-foot of just $75. Small shifts in price in Birmingham create large swings in percentage change, unlike a market like San Jose that has a median price-per-square-foot of $363. For example, a $10 increase in median price-per-square-foot would represent 13.3% growth for Birmingham and just 2.8% growth for San Jose.
Out of all top 50 major metros, only eight markets should see prices fall in 2013. Of those eight markets, average declines should come in at just 0.9%. St. Louis home prices in 2013 are expected to fall 1.7%, the largest of forecasted declines in the top 50 major metros. St. Louis, however, is another one of those low-priced markets, with a median price-per-square-foot of just $66. As expected, this market could easily see notable percentage point shifts with small changes in price.
All told, 2012 ended strong and 2013 is poised for a continued recovery. The national housing market has continued to grow at a healthy pace, and chances of a robust recovery are slim in 2013, in part because we have less ground to make up. While prices are still off their peaks by 37.6%, they are now more aligned with historical average rates of growth. While a larger economic setback could easily change the course for the worse, current rates of growth signal the market is slowly calibrating itself to pre-bubble rates and prices.
Top 50 Major Metro Markets----------------------------------------------------------------------------Forecast Qtr/Qtr REO One YearRank Metropolitan Statistical Area % +/- Yr/Yr Saturation Forecast---------------------------------------------------------------------------- Seattle, WA - Tacoma, WA -1 Bellevue, WA 2.8% 15.7% 9.3% 13.5%----------------------------------------------------------------------------2 Birmingham, AL - Hoover, AL 3.6% 13.3% 24.1% 10.0%----------------------------------------------------------------------------3 Bakersfield, CA 2.0% 10.8% 26.5% 7.9%----------------------------------------------------------------------------4 Fresno, CA 1.7% 7.9% 24.6% 7.6%---------------------------------------------------------------------------- Minneapolis, MN - St. Paul, MN -5 Bloomington, WI 2.3% 16.3% 19.0% 7.3%---------------------------------------------------------------------------- Milwaukee, WI - Waukesha, WI -6 West Allis, WI 1.4% 4.9% 23.1% 6.4%---------------------------------------------------------------------------- Phoenix, AZ - Mesa, AZ -7 Scottsdale, AZ 3.1% 26.1% 17.6% 6.1%---------------------------------------------------------------------------- Houston, TX - Baytown, TX -8 Sugar Land, TX 1.8% 6.3% 18.3% 6.1%---------------------------------------------------------------------------- Washington, DC - Arlington, VA -9 Alexandria, VA 1.4% 10.2% 7.3% 6.1%---------------------------------------------------------------------------- Miami, FL - Ft. Lauderdale, FL -10 Miami Beach, FL 2.2% 14.0% 26.3% 6.0%----------------------------------------------------------------------------11 Jacksonville, FL 1.0% 5.7% 27.2% 5.0%----------------------------------------------------------------------------12 Las Vegas, NV - Paradise, NV 2.5% 12.5% 41.8% 4.9%---------------------------------------------------------------------------- Sacramento, CA - Arden, CA -13 Roseville, CA 2.7% 11.5% 18.9% 4.8%---------------------------------------------------------------------------- Portland, OR - Vancouver, WA -14 Beaverton, OR 1.8% 6.8% 9.7% 4.7%----------------------------------------------------------------------------15 Richmond, VA 0.9% 5.1% 15.3% 4.6%----------------------------------------------------------------------------16 Tucson, AZ 2.4% 11.5% 29.5% 4.5%---------------------------------------------------------------------------- Tampa, FL - St. Petersburg, FL -17 Clearwater, FL 0.6% 5.6% 25.2% 4.3%---------------------------------------------------------------------------- San Francisco, CA - Oakland, CA18 - Fremont, CA 3.0% 16.1% 14.4% 4.2%----------------------------------------------------------------------------19 Dayton, OH 0.8% 1.5% 27.2% 4.2%---------------------------------------------------------------------------- Riverside, CA - San Bernardino,20 CA - Ontario, CA 1.5% 8.9% 23.8% 4.1%---------------------------------------------------------------------------- Cleveland, OH - Elyria, OH -21 Mentor, OH 1.9% 3.8% 31.1% 3.6%---------------------------------------------------------------------------- San Jose, CA - Sunnyvale, CA -22 Santa Clara, CA 3.1% 17.2% 8.8% 3.3%----------------------------------------------------------------------------23 Cincinnati, OH - Middletown, OH 0.8% 3.7% 20.4% 3.2%---------------------------------------------------------------------------- Providence, RI - New Bedford, MA24 - Fall River, MA 1.2% 0.3% 8.0% 3.2%---------------------------------------------------------------------------- Oxnard, CA - Thousand Oaks, CA -25 Ventura, CA 1.4% 5.1% 18.1% 3.1%----------------------------------------------------------------------------26 Orlando, FL 1.2% 8.6% 26.0% 3.0%---------------------------------------------------------------------------- Dallas, TX - Fort Worth, TX -27 Arlington, TX 0.2% 2.5% 26.1% 2.6%---------------------------------------------------------------------------- San Diego, CA - Carlsbad, CA -28 San Marcos, CA 1.7% 8.4% 15.1% 2.4%---------------------------------------------------------------------------- Hartford, CT - West Hartford, CT29 - East Hartford, CT -0.5% 2.3% 4.2% 2.2%---------------------------------------------------------------------------- Los Angeles, CA - Long Beach, CA30 - Santa Ana, CA 1.9% 8.9% 17.1% 1.9%----------------------------------------------------------------------------31 Pittsburgh, PA 0.4% 5.9% 6.4% 1.9%----------------------------------------------------------------------------32 Memphis, TN 0.7% 3.0% 36.4% 1.8%----------------------------------------------------------------------------33 Columbus, OH -1.6% 2.3% 29.0% 1.5%----------------------------------------------------------------------------34 Honolulu, HI 0.3% 0.4% 9.8% 1.4%---------------------------------------------------------------------------- Nashville, TN - Davidson, TN -35 Murfreesboro, TN 0.6% 2.9% 17.7% 1.4%----------------------------------------------------------------------------36 Raleigh, NC - Cary, NC -0.2% -1.5% 6.1% 1.3%---------------------------------------------------------------------------- Boston, MA - Cambridge, MA -37 Quincy, MA 0.2% 1.4% 5.5% 1.2%---------------------------------------------------------------------------- New Orleans, LA - Metairie, LA -38 Kenner, LA 0.2% 0.4% 17.1% 1.0%---------------------------------------------------------------------------- NY, NY - No. New Jersey, NJ -39 Long Island, NY 1.0% 4.2% 5.3% 0.9%---------------------------------------------------------------------------- Detroit, MI - Warren, MI -40 Livonia, MI 1.5% 7.8% 46.1% 0.8%----------------------------------------------------------------------------41 Rochester, NY 0.2% 2.0% 2.5% 0.8%---------------------------------------------------------------------------- Virginia Beach, VA - Norfolk, VA42 - Newport News, VA 0.6% 3.4% 14.0% 0.5%----------------------------------------------------------------------------43 Denver, CO - Aurora, CO 1.6% 11.0% 12.4% -0.2%----------------------------------------------------------------------------44 Louisville, KY -0.2% 0.0% 19.6% -0.4%---------------------------------------------------------------------------- Charlotte, NC - Gastonia, NC -45 Concord, NC -0.4% -2.4% 21.9% -0.4%---------------------------------------------------------------------------- Philadelphia, PA - Camden, NJ -46 Wilmington, DE -0.4% -2.2% 8.5% -0.6%---------------------------------------------------------------------------- Atlanta, GA - Sandy Springs, GA47 - Marietta, GA 2.5% 6.4% 37.4% -0.7%----------------------------------------------------------------------------48 Baltimore, MD - Towson, MD 1.0% 6.5% 7.5% -1.3%---------------------------------------------------------------------------- Chicago, IL - Naperville, IL -49 Joliet, IL 0.0% -0.2% 31.7% -1.5%----------------------------------------------------------------------------50 St. Louis, MO -0.8% -2.4% 33.5% -1.7%----------------------------------------------------------------------------
