ShareREALTORS® generally expect prices to increase over the next 12 months with a median expected price increase of 4 percent, according to the latest REALTORS® Confidence Index [1]. Slower sales due to tight credit conditions, declining affordability due to the recent price growth amid modest income gains, and fewer distressed sales likely account for the modest expectations.
REALTORS® in most states expect prices to increase in the range of 3% to 5%. However, in states where inventory is very low and where cash sales are strong (e.g. FL), the expected price growth is in the range of 5% to 7%. In states that have modest income growth, the expected price growth is less than 3 percent (blue).
[1] The median expected price change is the value such that 50 percent of respondents expect prices to change above this value and 50 percent of respondents expect prices to change below this value. A median expected price change is computed for each state based on the respondents for that state. The graph shows the range of these state median expected price change.