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Where are the Best Opportunities for Home Buyers?

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    Zillow Chief Economist Stan Humphries on the outlook for the housing market.

  • Duration 4:57
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So you put aside the debt ceiling debacle -- the fiscal clip fiasco there is -- some hopeful news in the housing market at least zillow says last year national home values.

Rose almost 6%.

Nearly double the historical average we haven't seen video games like that since the peak of the housing -- bubble back in 06.

But experts say it's not -- -- we wanna make sure our viewers here on money don't miss the boat and that's why zillow as chief economist.

CM Humphries is here in a Fox Business exclusive he's gonna help forecast the Best -- still out -- great to have you back on the -- stand.

Some start with why do you think this camp last.

Great to be -- Melissa yeah it's definitely -- to -- 6% appreciation nationally in the first year after the housing market reached the bottom.

Is is somewhat unprecedented I think for -- most economists were expecting given the high foreclosure rate in high negative equity rate.

But in some sense the high net negative equity right is actually contributing an increase in the price spikes because it's -- inventory.

If people can't sell their houses even though there's new demand moving into good and the only way -- markets and responds by these price spikes and that's why we're seeing price spikes.

Of about 42% of places like Phoenix and above 14% in Las Vegas.

So -- -- -- some extraordinarily.

Positive price appreciation and markets right now the trouble is that it's not really sustainable because at some point.

The negative equity real road people gonna put their homes up for sale and we should see more supply marketplace.

Yeah also I -- existing home sales numbers were out today and that showed a little bit of the month over month decline although your every year it was a lot better.

There's so much housing data out -- -- so much noise I always feel like it's conflicting.

I mean right now do you feel like we're definitely on the -- upswing overall in housing would you -- Yeah I think generally we were pretty optimistic about that it's a -- -- right now and you know you do have to in terms of home sales being down between November and December you know that one that one percentage point blip.

It is better to kind of look at a longer term perspective what's happening year -- year -- year every year.

You know throughout the throughout all of 2012 we saw about twelve to 15%.

More demand that we did the prior -- -- demand is definitely.

Returning.

And in fact a lot of parts of the country we we have we were seeing inventory constraints and that's what we're seeing new construction start up in and really sure it's a lot of parts of California.

We're looking at a map right now that shows where some of the strongest since some of the weakest places are in the country right now some before I get to where you think -- -- opportunities are.

Where have you seen the strength of why do you think that is it looks like a lot of places that were hard hit like Florida and California.

Yeah that's definitely the the the the common denominator is places that were really hard hit so think Florida.

Arizona Nevada California.

Those places we've seen just enormous resets in home prices -- of some of the places that are responding the best right now and that's because affordability is at all time highs prices have been reset some cases more than ten years.

You pair that with mortgage rates which are you know well below 4% now and it's -- -- store affordability.

Still talked about where the opportunities still exists because I hate when I hear about where I've missed an opportunity and there's no you know way to get -- -- make money -- myself.

Well I mean essentially you know if you're if you're thinking about getting in the market you know -- in the market then.

In the best time -- gotten in would be nationally at the bottom which was October 2011.

So essentially you're already a year past.

That where's there's still opportunity.

You think -- you expect New York Atlanta and Chicago to rise that they're still good opportunities there.

That's right now and of those three New York Chicago Atlanta those are those are -- markets because they're ones that have.

Are still seeing -- price depreciation in many parts as markets in her and her -- the laggards.

Via a top thirty metro so those are places where.

The whole market that the housing market is not yet fully recovered mistook a lot of foreclosures lot of negative equity and but they'll do quite well they'll do -- 4013.

Until -- doing better after that come off for those markets well it was Chicago in New York are a little bit more has more headwinds because -- in.

To have judicial foreclosure across the seas which means that there's a long pipeline of foreclosures and that tends to cloud those markets a little bit quite positive -- Atlanta.

Well Atlanta I would say is had a very long -- -- recession and it's been a little bit of of a sleeper in terms of hard -- markets -- mean typically we talk about Vegas and Phoenix Miami Stockton California.

But Atlantis had a very hard house reception in her long -- a recession and if you look at kind of where prices are back to historical levels.

In terms of -- comes -- -- even rents Atlanta's looking pretty good now I think Mitt.

Atlanta has had a lot of bank failures of the state of Georgia in the still a lot of foreclosures but it does seem as though investor activity.

Is basically is moving out of Phoenix and Vegas and it's moving now to Atlanta right now.

Okay CM thanks so much coming -- we appreciate your time gets that.

Yet they -- -- most of next on.

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