Local Market Monitor

ECONOMIC OUTLOOK

Over twenty years of proven expertise and trend analysis in evaluating residential property values.

12-MONTH HOME PRICE FORECAST

Local Market Monitor's Home Price Forecasting Model forecasts home price changes one year into the future. Our forecast starts with the calculation of the current Equilibrium Home Price for a local market. Then the current actual home price in that market, based on raw HMDA data from the FFIEC, is compared with the Equilibrium Home Price. If the current price is close to the Equilibrium Price, a market is considered to be balanced, however if the current price is much higher or lower than the Equilibrium Price, the market is either over or under priced.

The forecasting equations have the same components, but with different weights depending on the difference between the current actual home price and the calculated Equilibrium Home Price:

In balanced markets, income growth is the primary factor determining future home values. Local income growth is projected by Local Market Monitor based on current local job growth and overall growth of the national economy.
In over-priced markets, the momentum of home value changes is more important than income growth in determining future home values.
In under-priced markets, income growth is the dominant factor determining future prices.