SEATTLE, Aug. 10, 2016 /PRNewswire/ -- As businesses look
for cheaper places to expand, job growth in the middle of the
country will begin attracting more residents, according to experts
surveyed in the latest Zillow® Home Price Expectations (ZHPE)
Survey.
That would reverse a trend over the last decade that drew many
to the coasts following strong job markets, with more employment
and income growth. Over half of experts surveyed said they don't
expect migration to the coasts to continue indefinitely. Of those,
56 percent pointed to jobs and 24 percent said high housing costs
on the coasts will drive residents inland.
Recovery from the housing boom and bust has looked very
different for Middle America and coastal America. While markets on
the East and West coasts experience rapidly rising home values and
strong job markets, markets in the Rust Belt and Midwest are moving
more slowly; negative equity is still prevalent and job growth is
minimal.
The quarterly ZHPE survey, sponsored by Zillow and conducted by
Pulsenomics LLCi, asked more than 100 housing experts
about their expectations for the housing market.
The experts were also asked if they thought the distinct split
between Middle America and the two coasts would reverse. Over half
of the respondents said this trend has already begun to reverse, or
expect it to in the future. A quarter of respondents believe this
trend is a permanent shift, and 11 percent believe the migration to
the coasts is an illusion.
Of the reasons experts predicted people would move back to the
middle of the country, job growth was most popular. Just over 20
percent said people would migrate inland in search of more
affordable housing, and 13 percent said Americans will start to
seek the traditional lifestyle that the middle of the country has
to offer. Only 2 percent said climate change will force residents
away from the coasts.
"Since the Recession, employment has boomed in relatively
expensive coastal areas, often attributed to a shift in preferences
among workers – especially millennials – but also facilitated by
soft labor markets that have resulted in a plentiful supply of
available workers," said Zillow Chief Economist Dr. Svenja Gudell. "Now, as labor markets tighten
and the country approaches full employment, employers will have to
look elsewhere to keep costs in check. For some businesses, this
will mean relocating away from expensive coastal areas to more
affordable interior communities. Sooner or later workers will
follow the jobs, providing an impulse to local housing
markets."
Overall, the experts surveyed predict home price appreciation
across the country will be up over 4 percent year-over-year by the
end of 2016. They expect home prices to slow down over the next
four years and by the end of 2020, they predict home prices will
grow at an annual pace of just 2.9 percent.
"Panel-wide, the experts currently expect U.S. home values to
finish 2016 with a healthy 4.5 percent year-over-year gain," said
Pulsenomics founder Terry Loebs.
"This projection implies a somewhat cooler, but still solid, second
half of the year. Although further price moderation is expected
next year, nearly 90 percent of the panel is projecting lower home
value gains in 2017. The longer-run outlook for housing market
performance remains steady. Overall, the expected five-year average
annual growth rate for home values actually rose, albeit slightly,
for the first time in three years."
Predominant reason
housing markets in Middle America will re-gain
popularityii
|
Percent
|
Job growth in the
middle of the country will begin attracting more residents as
corporations look for cheaper places to expand
|
56%
|
High housing costs in
coastal markets will push many residents away and toward cheaper
markets in the middle of the country
|
24%
|
In the future,
Americans will seek traditional quality of life advantages that
housing markets in Middle America offer
|
13%
|
Climate change and
increasingly damaging and volatile weather will force more
Americans away from the coasts
|
2%
|
Other
|
6%
|
Zillow
Zillow® is the leading real estate and rental marketplace
dedicated to empowering consumers with data, inspiration and
knowledge around the place they call home, and connecting them with
the best local professionals who can help. In addition, Zillow
operates an industry-leading economics and analytics bureau led by
Zillow's Chief Economist Dr. Svenja
Gudell. Dr. Gudell and her team of economists and data
analysts produce extensive housing data and research covering more
than 450 markets at Zillow Real Estate Research. Zillow also
sponsors the quarterly Zillow Home Price Expectations Survey, which
asks more than 100 leading economists, real estate experts and
investment and market strategists to predict the path of the Zillow
Home Value Index over the next five years. Zillow also sponsors the
bi-annual Zillow Housing Confidence Index (ZHCI) which measures
consumer confidence in local housing markets, both currently and
over time. Launched in 2006, Zillow is owned and operated by Zillow
Group (NASDAQ:Z and ZG), and headquartered in Seattle.
Zillow is a registered trademark of Zillow, Inc.
About Pulsenomics:
Pulsenomics LLC
(www.pulsenomics.com) is an independent research and consulting
firm that specializes in data analytics, new product and index
development for institutional clients in the financial and real
estate arenas. Pulsenomics also designs and manages expert surveys
and consumer polls to identify trends and expectations that are
relevant to effective business management and monitoring economic
health. Pulsenomics LLC is the author of The Home Price
Expectations Survey™, The U.S. Housing Confidence Survey, and The
U.S. Housing Confidence Index. Pulsenomics®, The Housing
Confidence Index™, and The Housing Confidence Survey™ are
trademarks of Pulsenomics LLC.
i This edition of the Zillow® Home Price Expectations
Survey surveyed 113 experts between July 19
and August 3, 2016. The survey was conducted by Pulsenomics
LLC on behalf of Zillow, Inc.
ii Of experts who said that the trend between Middle
America and coastal markets has already begun to reverse, or expect
that it will reverse.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/experts-new-jobs-in-the-midwest-to-drive-migration-back-to-the-heartland-300311604.html
SOURCE Zillow