Gary Painter, director of research for the University of Southern California-Lusk Center for Real Estate, said that home price growth is returning to historical norms. In the past, real estate prices have typically matched the rate of inflation.
“The only time there really was a deviation from the trend line was in the 2000s, when prices went sky-high and fell down well below the trend line,” he said. “But right now we’re very close to that trend line, and that makes me feel like prices are where they should be."
Although the housing market returning to normal, it is likely to take years for many homeowners to fully recover the value of their homes—if they ever do.
“The only people, and it’s understandable, that want house prices to move up further than that pace are people currently still underwater, and there’s still a significant number, though certainly less than there were two years ago,” Painter said.