CoreLogic has released their Home Pricing Index (HPI) report for August, and from the “stop me if you’ve heard this before” category, Idaho once again is tops in the nation for year-over-year price increases for homes. Home prices nationally increased by 5.9% year-over-year in August, and Idaho saw a 10.8% increase, the only state having appreciation in the double digits. Arizona and Maine rounded out the top three with 9.7% and 9.6% increases, respectively. Idaho’s gain is a full percentage point above July’s 9.8% finish. On a month-over-month basis, home prices ticked up about 1% nationally between August and July.
“Consumers who have not been as financially impacted by the ongoing economic pressures are taking advantage of low mortgage rates to either break into the market, upgrade their living situations or purchase second homes and investment properties,” said Frank Martell, president, and CEO of CoreLogic. “With heightened activity putting a strain on the current for-sale inventory, strong demand should help spur new home building activity.”
Despite the continued challenges brought on by the pandemic, consumer home purchasing power has stayed strong as mortgage interest rates remain near record lows, and people are slowly returning to work.
The report stated, “for-sale inventory has continued to dwindle, dropping 17% year over year in August, which created upward pressure on home price appreciation as buyers compete for the limited supply of homes.”
CoreLogic continues to be bearish on its expectations of price growth, as it’s anticipating more available inventory hitting the market, and unemployment slowing demand. It’s only predicting a .2% increase nationally by August of next year and believes many areas will experience a decline in prices.
Dr. Frank Nothaft, Chief Economist for CoreLogic, had this to say, “The imbalance between homebuyer demand and for-sale inventory is particularly acute for lower-priced homes. Because of this imbalance, homes priced more than 25% below the median were up 8.6% in price over the last year, compared with the 5.9% price increase for all homes.”
We’re experiencing a firsthand lesson in supply versus demand, especially here in the Treasure Valley. Last month, listings were down nearly 68% from the previous year, and the area has seen a median listing price grow by 12.3%. As demand continues to outpace supply, prices have nowhere to go but up. And as long as consumers are willing to pay, there’s no apparent end in sight for home values to stop appreciating.
The good news is if you’re thinking about selling your home, there’s no time like the present to list your house and get top dollar for it.
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