What Is Real Estate Appreciation Rates In The Us ?
With the recent recession and the burst of the real estate bubble, many were skeptical that real estate investment would not be something to dwell on. However, looking at the recent trends across the country, real estate has once again started appreciating, but not yet.
According to real estate experts, prices of homes will hit rock bottom by the end of 2010 or the beginning of 2011. Then there will be a steady decline in the value and prices of homes. However, thereafter, home prices will begin to appreciate once again. According to some experts, real estate appreciation in the US will begin some time in the year 2020 and then the rate of appreciation will around 1 percent to 2 percent more than the general rate of inflation. While this rate may seem insignificant after the recent boom, it is keeping in line with the long term average of appreciation.
If you look at the historical rate of appreciation, the prices of homes in the US have been increasing steadily from 1890 through 2008 by .5 percent point each year. This trend continued until the bubble burst. Hence, the annual appreciation was not that significant and only those who invested in a house for long term benefited from this appreciation.
Even demographics will have an influence on real estate appreciation rates in the US. In the long term, the price of homes will be in conjunction to the growth of wages. For the moment, as the US has a high rate of unemployment, this outlook may not look very promising, but it will happen by the year 2020.
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