The Scout Vision Top 5 for 5 Quarterly Report, Part I (Q3 2017)
With the Recession in Rear View and Real Estate Prices Steadily on the Rise, it’s High Time to Head South by Southwest
Location and timing – the two key facets of successful real estate investing. No one captures accurate insights into the “where” and “when” better than Scout Vision Trends & Forecasts.
And by all measures, it’s high time to head south by southwest.
Arming investors with past median home value data (quarter-by-quarter since 2000) and future 5-year home price appreciation rates, Scout Vision reveals that 4 out of the 5 top U.S. Metro Areas predicted to rise in real estate prices through 2022 are in the south and southwest.
Read on to discover what Scout Vision’s exclusive data can tell you about where and when to make your next investment.
Put Your Money on Vegas, or Make a Run for the Border
Like Phoenix rising from the ashes, the Las Vegas-Henderson-Paradise, NV Metro Area continues its storied comeback (see Figure 1), as predicted in our previous Scout Vision report.
Figure 1
With the Median Home Value expected to rise 35% over the next 5 years, it’s hard to fathom how down-on-your-luck the Las Vegas-Henderson-Paradise, NV Metro Area was following the 2008 financial crisis (see Figure 2). This offers little comfort, however, to those who bought a home in this area at the height of the market in late 2006, when the Median Home Value was $289,524, and sold at a substantial loss ($113,323) when the real estate market bottomed out in 2012.
A similar boom-and-bust-then-renaissance is occurring in other parts of the southwest, including the Phoenix-Mesa-Scottsdale, AZ Metro Area, where Scout Vision predicts a 27% rise in real estate prices through 2022.
Figure 2
Still skittish about betting on Vegas? A trip to the border is in order. Partially situated on the Rio Grande, the McAllen-Edinburg-Mission, TX Metro Area is roughly 70 miles from South Padre Island and the Gulf of Mexico.
Of the top metros in this latest report, McAllen-Edinburg-Mission, TX earns top billing for future 5-year home price appreciation rates (see Figure 1). While home prices aren’t high in the Metro, as a percentage they are forecasted to rise 38%, with the average Median Home Value jumping from $68,240 to $94,035 (see Figure 3).
Figure 3
There are several factors contributing to the McAllen-Edinburg-Mission, TX Metro Area’s rise, including healthy population growth, very strong housing stock, and vacancy rates that have stayed in check (see Figure 4).
Perhaps even more important, however, is the steady increase in wages and job growth, which are both in line with the rest of the country. These trends bode well for McAllen-Edinburg-Mission, TX Metro Area residents, and particularly home buyers: Although just below the region’s historic high, it only takes a little over two years of average household income to buy an average house in this Metro.
Figure 4
Coming Up: The Scout Vision Top 5 for 5 Quarterly Report, Part II
Stay tuned for the second part of our quarterly Scout Vision report, where we will reveal historic trends and forecasts for the Top 5 U.S. Metropolitan Areas predicted to fall in real estate prices over the next 5 years.
About the List
Metropolitan areas are ranked by overall forecasted appreciation. But the lists above also highlight significant variation in forecasted appreciation by neighborhood within each metro.
Sometimes the variation from the lowest forecasted appreciation neighborhood to the highest can be greater than the overall forecasted appreciation for that metro. This reveals that – as many investors, lenders and appraisers have experienced – much of the opportunity and risks depend on where in the metro area the subject property is located. Not just the broad ZIP Code, but the specific Micro-Neighborhood.
About the Data
Industry veterans and PhD geographers developed Scout Vision by drawing on over a decade of research and development and leveraging the latest geo-statistical techniques and theory. Scout Vision’s 5-year Micro-Neighborhood™ Home Price Forecast is based on 200+ independent variables, 35+ unique data dimensions, and 21 custom, geographically nested, hierarchical models that capture market forces which operate at various spatial and time scales to drive price changes block by block.
Thus, Scout Vision uniquely identifies otherwise unseen opportunity by generating home appreciation projections that combine unprecedented geographic precision with up to 90% predictive accuracy.
Licensing Scout Vision Enterprise Today
For real estate investment firms with 500+ properties or companies needing API or large bulk file processing, request a data sample of up to 10 addresses and discover what Scout Vision Enterprise can do for your firm.
For real estate investment firms with fewer than 500 properties or individuals with independent investments, take advantage of Scout Vision’s forecasting capabilities through a NeighborhoodScout Pro Subscription.