Case-Shiller, Zillow Stats Say Seattle Real Estate Has Hit Bottom

While the outlook for recovery and a return to price increases in Seattle real estate is a contested topic, two groups seem to have come to the conclusion that real estate is finally bottoming out.

MacroMarkets, using Case-Shiller Indices views the market as headed into recovery mode, and Zillow is predicting it will happen next quarter. MacroMarkets is predicting a moderate increase in home prices over the next five years, while Zillow thinks it will be flat market. For recession-weary home owners, even "flat" is a nice word to hear in the real estate market.

Economists polled MacroMarkets predict U.S. housing prices will rise by 12% over the next five years, based on the S&P Case-Shiller Index.

MacroMarket's co-founder Robert Shiller did not participate in the survey but called the 12% forecast "a plausible scenario," The WSJ reports.

Plausible...but not likely, says Stan Humphries, chief economist at Zillow.com. "12% over next five years is probably a little high."

For the past year-plus, Zillow has been predicting an "L-shaped recovery" in housing, a forecast Humphries reiterates in the accompanying video.

"We're predicting a bottom in the third quarter of 2010," he says. "Once we hit bottom, we are going to see a sustained period...three-to-five years of modest-to-negligible appreciation, and perhaps flat-to-down in 'real' terms," meaning adjusted for inflation.

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Sam DeBord is a Realtor and real estate broker with SeattleHome.com, a division of Washington State Realty, LLC. He is a member of the Seattle-King County Association of Realtors and a Green-Certified Pro.

Have a question about a home, or Seattle real estate in general?
Sam can be contacted at (206) 658-3225 or Sam(at)SeattleHome.com.