Housing Markets Hit Highest Prices in Nearly 40 Years

The housing market continues to make solid strides in its recovery nationwide, with some states experiencing growth above and beyond their historic peaks, according to a new analysis.

Home prices nationwide, including distressed sales, rose 5.9% in March 2015 compared to the same month in 2014, representing 37 months of consecutive year-over-year increases in home prices nationally, says the latest CoreLogic Home Price Index (HPI). On a monthly basis, national home prices rose by 2% in March compared with February.

Including distressed sales in March, 27 states plus the District of Columbia were either at or within 10% of their peak prices. Furthermore, seven states including Colorado, Nebraska, New York, Oklahoma, Tennessee, Texas and Wyoming achieved new home price gains since January 1976, when the CoreLogic HPI started.

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States with the highest price growth in March included Colorado (9.2%), South Carolina (9.1%), Kansas (8%), Texas (8%) and Nevada (7.6%). 

“The homes for sale inventory continues to be limited while buyer demand has picked up with low mortgage rates and improving consumer confidence,” said Frank Nothaft, chief economist for CoreLogic, in a written statement.

As a result, Nothaft notes, there has been continued upward pressure on prices in most markets, with CoreLogic’s national monthly index up 2% in March and approximately 6% up from a year ago.

Looking broadly at the national housing market’s progress, price gains in March appeared to have been driven by 90 of the top 100 Core Based Statistical Areas (CBSAs) showing year-over-year increases during the month. 

The 10 CBSAs that showed the largest year-over-year declines were mostly located out East. With the exception of New Orleans-Metairie, LA, the rest included Baltimore-Columbia-Towson, MD; Philadelphia, PA; Camden, NJ; Hartford-West Hartford-East Hartford, CT; Rochester, NY; Worcester, MA-CT; Albany-Schenectady-Troy, NY; New Haven-Milford, CT and Wilmington, DE-MD-NJ. 

Despite the decline in prices witnessed in those select markets, the strong monthly gains in March may be a harbinger of accelerating price appreciation as the spring selling season is now upon us, says CoreLogic CEO Anand Nallathambi. 

“All signs are pointing toward continued price appreciation throughout 2015,” Nallathambi said in a written statement. “Tight inventories, job growth and the inexorable impact of demographics and household formation are pushing price levels in many states, and especially large metropolitan areas like Dallas, Denver, Houston, Seattle and San Francisco, toward record levels.”

Looking ahead, the CoreLogic HPI Forecast indicates that home prices, including distressed sales, are projected to increase by 0.8% month-over-month from March to April 2015, and on a year-over-year basis by 5.1% come March 2016.

Written by Jason Oliva

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  • Although CNBC absolutely agrees with the assessment above they are also highly skeptical that such Nirvana will be seen due to rising mortgage interest rates. Even so there is little doubt that large sections of Texas and most of the California Bay Area will see increased appreciation now and into the near future.

    With such historical good news as indicated in the article, where are HECM for Purchase (H4P) originations? We keep reading what should be good news for that segment of our industry with very little results.

    I know this tone is considered very negative by H4P votaries, zealots, and monomaniacs but facts are generally difficult for such. It seems as if H4P should be a great boutique enterprise for those who can work closely with Realtors and builders. Unfortunately the voices we hear today are less of latter and too much of the former. Over the next few years we should see the H4P doers with vision separated from the mere dreamers. The sooner that day comes the better it will be for the industry.

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