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According to a new forecast from Zillow, home prices will rebound by next year after a predicted 4 percent fall this spring. Buyer demand and healthy housing-market dynamics will stop U.S. home prices from falling more than 2-3 percent (or 1.7 percent YoY), says Zillow. A full recovery, however, could take through the end of next year.

“Much uncertainty still exists, particularly with some states beginning to reopen and experts warning of a possible second wave of the coronavirus in the fall. However, housing fundamentals are strong — much more so than they were leading into the Great Recession — and that bodes well for housing in general,” said Dr. Svenja Gudell, Zillow’s chief economist. “Despite the difficulties, we’re seeing several signs that there is still a good amount of demand for housing, and buyers, sellers and agents are growing more comfortable moving transactions forward where possible. For those who need to sell, buyers are out there, and there are ways to embrace technology and practice social distancing to ensure a safe process.”

On the more optimistic side, home prices could drop 1-3 percent this spring, followed by a robust recovery. However, a more reserved forecast has the home price drop at 3-4 percent, with continued weakness throughout 2021, according to Zillow.

For more information, please visit www.zillow.com.

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