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The city of Tacoma is in the national spotlight this week after a newly released study projected it would experience the highest housing price increases in the nation over the coming two years.
Tacoma is among several Washington state metro areas that are expected to see well-above-average home price increases through 2012 and 2013, according to the study, released by Fiserv Inc. using data from the Federal Housing Finance Agency.
Despite the gloomy picture for the national economy and housing market, residents of Tacoma are in for a 25 percent increase in home prices by spring 2013, according to the report.
In addition, home prices in three other Washington state metro areas will be among the top 10 in the United States for the period from 2011 through early 2012. Those cities are Kennewick-Pasco-Richland, Spokane and Olympia.
Housing prices in the Seattle metro area also are also expected to bottom out this year and began climbing next year, increasing by as much as 10 percent through 2013.
Washington state's projected robust price increases are in stark contrast to much of the rest of the nation, which is expected to see an average 3.1 percent drop in housing prices through early 2012.
That comes after two years of plummeting home prices - down an average of 21.3 percent in 2009-2010 and 5.1 percent in 2010-2011, according to the study.
David Stiff, chief economist at Fiserv, noted that continued economic weakness and uncertainty continue to weigh on markets in much of the United States.
"The stabilization of housing markets depends greatly on household confidence in the strength of the economic recovery," he said. "Unfortunately, recent economic news has done little to build confidence."
Despite the weakness in housing markets, which remain a problem in nearly every region outside Washington state and some areas of Texas, Florida and Arizona, Fiserv continues to project that home prices remain on track to stabilize by the end of 2012, then begin to rise nationwide in 2013.
Stiff pointed to several positive trends. "Mortgage delinquency rates have been falling for more than a year. Foreclosure rates have started to decline. The flood of bank-owned sales, which has swamped many markets, will finally begin to recede this year as fewer houses enter the foreclosure pipeline. Meanwhile, housing affordability has nearly returned to pre-bubble levels," said Stiff.
According to Fiserv and Moody's Analytics, these factors, when combined with economic growth forecast for the coming quarters, point to a broad-based recovery for housing that will begin in early 2012.
Author:Brandi Rademacher Phone: 253-224-6663 Dated: August 12th 2011 Views: 1,652 About Brandi: Brandi Rademacher with RE/MAX Realty South is the Professional Realtor who other Realtors come to fo...
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