A nationwide panel of more than 100 professional forecasters expects home values to end 2013 up an average of 4.6 percent and rise cumulatively by 22 percent, on average, over the next five years, according to a first-quarter survey by Seattle-based Zillow.
Participants in the Zillow Home Price Expectations Survey predicted home values will rise another 4.2 percent on average in 2014, before moderating somewhat to annual appreciation rates between 3.6 percent and 3.8 percent for 2015, 2016 and 2017.
The survey was conducted February 22-March 7 by Pulsenomics LLC on behalf of Zillow.
"The panel is quite bullish on home prices near-term, considering a pre-bubble average appreciation rate of 3.6 percent per year," said Stan Humphries, Zillow's chief economist. "That said, their expectations are a bit shy of the home value gains of 5.5 percent that we saw in 2012, implying some moderation in the pace of gains.
"The panel expectations are consistent with continued strong home value growth this year fueled by tighter-than-normal inventory of for-sale homes and robust demand attributable to high affordability and a stronger general economy."
On average, panelists predicted home values to rise 4.1 percent annually from 2013 through 2017, exceeding the pre-housing bubble (1987-1999) average annual appreciation rate of 3.6 percent.
This is the first time the predicted average annual growth rate for the next five years has surpassed pre-bubble levels since the survey's inception three years ago.