ZILLOW HOUSING MARKET REPORT

Last year's mortgage rate shock was so abrupt that researchers at Zillow had no choice but to repeatedly issue sharp downward revisions for their 12-month home price outlook. In March 2022, Zillow had been expecting home prices to rise 17.8% over the next 12 months. By December 2022, however, that was slashed all the way down to a forecasted decline of 1.1%.48

 

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Housing: 'Affordability is really the sticking factor' amid declining home sales, economist says

 According to Freddie Mac, one 
 year ago those rates 5.11%. 

Lance Lambert

Sun, April 23, 2023 at 1:00 PM MST·4 min read

In this article:

Last year's mortgage rate shock was so abrupt that researchers at Zillow had no choice but to repeatedly issue sharp downward revisions for their 12-month home price outlook. In March 2022, Zillow had been expecting home prices to rise 17.8% over the next 12 months. By December 2022, however, that was slashed all the way down to a forecasted decline of 1.1%.

A divided housing market: Zillow says these 294 markets to see home price gains while these 102 markets tick lower

BYLANCE LAMBERT

April 23, 2023 at 1:00 PM PDT

Last year’s mortgage rate shock was so abrupt that researchers at Zillow had no choice but to repeatedly issue sharp downward revisions for their 12-month home price outlook. In March 2022, Zillow had been expecting home prices to rise 17.8% over the next 12 months. By December 2022, however, that was slashed all the way down to a forecasted decline of 1.1%. . . Fast-forward to April 2023, and not only have mortgage rates stabilized around 6.5% this spring but the housing correction has also lost steam. That explains why Zillow stopped issuing downward forecast revisions, and is actually starting to raise its outlook.

Heading forward, Zillow economists expect U.S. home values as tracked by the Zillow Home Value Index (ZHVI) to rise 1.7% between March 2023 and March 2024.

However, that's its national outlook. If the bifurcated housing market correction—which has been sharp out West and mild in the East—has reinforced anything it's that real estate is indeed local.

Among the 400 largest housing markets tracked by Zillow, the company expects 294 markets to see positive home price growth between March 2023 and March 2024, while it expects four markets to remain flat and home prices to fall over the next 12 months in 102 markets.

Just one month ago, Zillow expected 238 markets to rise between February 2023 and February 2024, while it expected 156 markets to decline during that same span.

Let's take a closer look at Zillow's latest forecast.

View this interactive chart on Fortune.com

Between March 2023 and March 2024, Zillow expects some of the biggest home price upticks to occur in markets like Knoxville, Tenn. (+4.5% forecasted home price growth), Savannah, Ga. (+4.5%), Winston-Salem, N.C. (+4.4%), Johnson City, Tenn. (+4.2%), and Wilmington, N.C. (+4.1%). Simply put: Zillow's forecast model expects a great deal of strength in the U.S. Southeast.

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