The U.S. real estate market just keeps chugging along, with a 7.1% year-over-year increase in single-family home prices for March 2017 and a 1.6% bump from the previous month, according to new data from CoreLogic.
That’s the 62nd straight month with year-to-date gains in CoreLogic’s Home Price Index metric, the real estate research firm says, or more than five consecutive years of rising home prices. Consistent with previous months, CoreLogic warned that the market is no longer posting double-digit price increases, and those figures remain 2.8% below the peak recorded during the halcyon pre-recession days of April 2006.
“With a forecasted increase of almost 5 percent over the next 12 months, the index is expected to reach the previous peak during the second half of this year,” CoreLogic chief economist Frank Nothaft said in the report. “Prices in more than half the country have already surpassed their previous peaks, and almost 20 percent of metropolitan areas are now at their price peaks.”
Washington state turned in the greatest appreciation, with average single-family homes selling for 12.8% higher prices than at the same point in 2016, followed by Utah, Oregon, Colorado, and Idaho. As RMD has observed in previous months, these home price figures loosely track with home equity levels and reverse-mortgage origination data: For instance, CoreLogic also found the greatest levels of home equity gains between 2015 and 2016 in Washington state, and the Evergreen State has seen a 26.6% increase in year-to-date Home Equity Conversion Mortgage endorsements through February 2017, according to Reverse Market Insight. Colorado’s HECM endorsements were running 52.5% higher than at the same point in February 2016.
Across the country, 15 states from Massachusetts to North Carolina to Hawaii — and yes, Washington, too — recorded record-high home prices in March 2017, with only Alaska and West Virginia seeing contraction.
Bubble-watchers might note that CoreLogic also found 105 “overvalued” markets based on the Home Price Index and long-term viability estimates, including large swaths of Texas and almost all of Florida, but those numbers still pale in comparison with CoreLogic’s estimates in the lead-up to the housing collapse of 2007.
Still, the research firm predicts slower growth ahead, with a forecasted rise of just 4.9% between March 2017 and March 2018, and a barely registering 0.6% rise in home prices for April 2017.
Written by Alex Spanko