The housing market will slowly pull itself up during 2012 due in part to improvements in home prices, according to a quarterly report by real estate data firm Veros Real Estate Solutions.
The VeroFORECAST for the 12-month period ending December 1 indicates the residential real estate market is expected to experience moderate growth. In the nation's strongest housing sectors, home prices are estimated to rise roughly 4 percent, while the worst markets are projected to see prices dip 5 to 6 percent.
"Overall, the recovery in the housing market is in line with our previous forecasts as it is limited to just a few markets and is taking a long time to occur," said Veros vice president of statistical and economic modeling Eric Fox. "The good news is that many markets are no longer expected to be radically declining. We continue to be consistent in saying that the recovery will be a lengthy and gradual one."
The two top markets Veros states should experience home price hikes during the year are located in North Dakota. Fargo and Bismarck were declared the residential sectors most likely to see the biggest gains - 3.5 and 3.3 percent, respectively. Other markets expected to improve during 2012 include the metro Washington, D.C. area, Honolulu and Anchorage, Alaska.
Three of the forecast weakest markets for the 12-month period reside in California - Bakersfield, metro Sacramento and Fresno. The other two markets in the top-five projected worse markets in the U.S. this year are the metro Las Vegas and Reno areas.
Though home prices may remain flat or grow only slightly this year, other forecasts have indicated there may be greater improvements for the residential real estate market.
RE/MAX chairman and co-founder Dave Liniger stated a number of positive factors could potentially take place in 2012 that would help the housing market return to form.
"Interest rates will remain at or near historic lows and home prices will stabilize and start to rise by the end of the year," said Liniger. "There's no question, the housing recovery will be slow and steady, but for many cities the turn-around is already happening."