Home Prices to Fall 1% in 2012 but Rebound in 2013

By Sari R. Updated on 9/25/2013

In 2010, the double-dip in housing prices began and continued through the September of 2011. However, there are signs of a possible recovery for next year (2013).
   
Projections are that average U.S. home prices will drop yet another percent this year, but that increased home sales and better economic climate will cause a 3.8% increase in 2013. Nationwide, home prices fell in 88% of the major metro areas tracked in Q3 from the prior quarter and year-earlier period. A U.S. home average price fell to a new post-bubble low, declining 3.9% from a year ago. Average real estate prices are currently 33% below their 2006 peak values with weaknesses nationwide. 

Some of the larger metropolitan areas that somehow were not impacted as bad by the home price bubble, such as Houston and Dallas in Texas, and Salt Lake City should expect increases in values between 1% and 3%. Smaller metros such as Boise and Albuquerque can even do better with increases of 4% to 6%.

However, the recovery in such markets is not going to be broad enough to make an impact on the national average in 2012. Projections have average U.S. prices will decline another 2.7% by the third quarter of this year, compared to the year-ago period, before rising 3.8% by the third quarter of 2013.