According to the latest forecast by Moody's Economy.com, the nation's home price picture is going to be rather smudgy in the coming years. The study it conducted analyzed the high and low ends of real estate values in the targeted markets, a total of 379 of the largest ones. Only the median prices in the single-family category were used.
The survey came up with an above 10% drop in 86 of the cities, which is bad enough, and over a 1% slide in 290 other markets. That's just about all of the areas the study covered. When they averaged out the decline, it came to 7.7%, a nice uptick from 6.6% that they published in June. Evidently we're heading in the wrong direction.
As expected the hardest hit cities are in the Sun Belt where prices typically raced higher than anywhere else during those rocket-like years. They have tons of foreclosures and plenty of unsold new homes that continue to flood already large inventories. Stockton, CA, heads the parade with an estimated slide of 25% and right on its heels come two Florida markets, Palm Bay/Melbourne and Sarasota/Bradenton. Reno/Sparks is a surprise entry in fourth place, a market I thought had more going for it than that. Las Vegas comes in at number 10, a supportable position.
Moody's has some good news to pass around, too. It is projecting growth in areas where prices have generally remained low. Brownsville/Harlingen market in Texas, where the median single-family house is priced just below $120,000, should improve by 7.9%. Of the bigger cities at least Buffalo and Pittsburgh are on course to make gains.
For most of the country it's going to be a bumpy ride through some foamy rapids.