Luke Mullins

Real estate prices in these cities are expected to increase at sluggish rates

Despite the historic bust, U.S. home prices are expected to appreciate steadily over the coming decade. Moody's Analytics projects that real estate values at the national level will increase an average of 3.1 percent a year from 2010 to 2020. But just as the housing crash impacted Las Vegas much differently than Boston, the pace of future home-price appreciation will vary a great deal from one place to the next. To pinpoint the markets that will witness the slowest rates of appreciation, U.S. News obtained 10-year home-price projection data from Moody's Analytics for the 100 largest metropolitan statistical areas in the country. These projections are based on economic considerations like growth in income, employment, and population. Based on this data, here are the 10 slowest appreciating housing markets for the next 10 years.

There's no question that Virginia Beach, Va., is a delightful place to live. On account of its low crime rate, strong school system, and long shoreline, U.S. News in 2009 named Virginia Beach one of the best places to grow up. But while the area's quality of life may be attractive, its outlook for home-price appreciation over the next decade is less enticing. Moody's Analytics projects real estate values in Virginia Beach will increase an average of only 1.1 percent a year from 2010 to 2020, significantly below the national average of 3.1 percent. These sluggish increases are rooted in the market's recent performance. While home prices in Virginia Beach increased significantly during the boom, the market didn't experience a subsequent crash, says Michael Zoller of Moody's Analytics. The market "has actually retained most of its gains," Zoller says. And since prices didn't plummet, the market won't get the rebound that's expected to boost 10-year annualized home price appreciation rates in cities that were hit harder by the housing bust.

Like many other markets in Florida, home prices in sunny Miami soared during the housing boom. Thanks to easy credit and investor demand, real estate values there doubled from 2002 to 2006. But the ensuing crash has dragged home prices down nearly 48 percent from their peaks, and Moody's Analytics doesn't expect values to hit bottom until 2012. As a result, home prices in Miami will appreciate, on average, only about 1.1 percent a year from 2010 to 2020, according to Moody's Analytics. That's well below the national average.

Home of Brigham Young University and next door to the Sundance Ski Resort, Provo is the third-largest city in Utah. During the real estate boom, the area became popular among second-home buyers, many of whom financed their purchases with exotic mortgage products, Zoller says. But as demand weakened, values began sliding. Moody's Analytics expects home prices in Provo to drop 23 percent from their peaks by the time they reach bottom next year. As a result, area home prices are projected to increase an average of only about 1.2 percent annually over the next 10 years, according to Moody's Analytics.

Although home prices in Nashville, Tenn., increased during the housing boom, the area's rate of appreciation was not as dramatic as many other cities. And while that means its peak-to-trough decline won't be terribly deep, it also suggests that Nashville won't have an aggressive rebound in prices to help inflate its 10-year annualized growth rate, Zoller says. Moody's Analytics projects that real estate values in Nashville will increase an average of about 1.2 percent a year from 2010 to 2020. That's well below the national average of 3.1 percent. Likewise, home prices in Austin, Texas, didn't surge during the real estate boom. As a result, the area's 10-year annualized home price growth rates won't be lifted by a post-crash rebound. Real estate values in Austin will increase an average of 1.3 percent a year from 2010 to 2020, according to Moody's Analytics.

The similar performances -- less boom, less bust -- of five other markets will hogtie their annual growth rates as well, Zoller says. Real estate values in San Antonio, Texas, will increase an average of around 1.4 percent a year from 2010 to 2020, Moody's Analytics projects. Home prices in Oklahoma City, Okla., will increase 1.5 percent a year. Richmond, Va.'s real estate market is projected to appreciate roughly 1.6 percent annually, while prices in Denver should perform only slightly better, increasing 1.7 percent a year. Meanwhile, Moody's Analytics projects real estate values in Greenville, S.C., will increase 1.7 percent a year from 2010 to 2020, still significantly below the national average of 3.1 percent.