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Prices nationwide jumped 6.9 percent in April from a year ago, according to the latest monthly value report from CoreLogic. While that is slightly less than the 7 percent annual jump in March, it is still making more and more markets unaffordable. Today we’ll be discussing what this means for agents. Is a crash on the horizon?
According To A New CNBC Article:
- Home prices nationwide jumped 6.9 percent in April from a year ago, according to the latest monthly value report from CoreLogic.
- While that is slightly less than the 7 percent annual jump in March, it is still making more and more markets unaffordable.
- Of the nation’s 50 largest housing markets, 52 percent were considered overvalued in April.
“Of the nation’s 50 largest housing markets, 52 percent were considered overvalued in April. CoreLogic determines affordability “by comparing home prices to their long-run, sustainable levels, which are supported by local market fundamentals (such as disposable income).” In March, 50 percent of markets were considered overvalued.
Some argue that the improving economy will support higher home values. So far that appears to be the case. Overall home sales have been weakening, but most blame that on lack of listings more than weakened affordability, although higher prices have to be sidelining some buyers.
“Extremely low inventory conditions in most markets are preventing sales from breaking out, while also keeping price growth elevated,” said Sam Khater, chief economist at Freddie Mac. “Even if rates climb closer to 5 percent, sales have room to grow more, but only if current supply levels start increasing more meaningfully.”
