Fiserv: Home Prices Still Have a Long Way to Climb
Despite recent progress, home prices still have a long way to go to return to the peaks they reached during the housing boom, the analytics firm Fiserv reports.
From 2007 to 2012, home prices nationwide fell by a third on average, according to Fiserv’s findings.
Prices have been on the rise lately and many economists predict prices will continue to rise. But according to Fiserv’s projections, it will take a long time to make up the ground lost in the last five years.
Fiserv predicts that for the next five years, home prices will increase an average 3.7 percent a year. Still, that would leave prices 20 percent below their peak, Fiserv notes.
Some areas will take longer than others to return to their peak levels again.
“In some hard-hit markets, prices could take decades to recover,” Fiserv economist David Stiff told CNNMoney, adding that Arizona, California, Florida, and Nevada may have the longest waits. For example, in Nevada, home prices have fallen nearly 60 percent from the peak, and Fiserv predicts it could take 40 years to reach 2007 levels once again there.
On the other hand, Fiserv notes that many places which saw only slight increases during the housing boom may already be seeing prices edge higher than they were five years ago. For example, many areas in South Dakota, Texas, and West Virginia have seen prices inch higher, Fiserv notes. North Dakota, which is in the midst of a housing shortage, has seen prices climb 17.7 percent over the past five years.