CoreLogic’s May 2019 Home Price Index tells us that annual home price growth accelerated in the US for the first time in 14 months. The increase was +3.6% y/y and CoreLogic’s HPI forecast calls for an increase of +5.6% through May 2020.
On a month-to-month basis CoreLogic predicts that home prices will increase +0.8% from May 2019 to June 2019.
CoreLogic’s chief economist, Dr. Frank Nothaft, said, “Interest rates falling nearly 1 percentage point between November 2018 and May 2019 has been a real shot in the arm for home sales, plus it accelerated home price growth for the first time since March 2018.”
Top 10 States with the Largest Y/Y Home Price Changes
– Idaho +10.7%
– Utah +7.8%
– South Dakota +7.7%
– Nevada +6.9%
– Arizona +6.1%
– Indiana +6.0%
– Kansas +5.9%
– Tennessee +5.4%
– Mississippi +5.3%
– Maine +5.2%
North Dakota was the only outlier state to experience a decrease in home prices, -1.7%, in May 2019. Importantly, this was the 11th straight month of annual home price decreases in that state.
Overall, CoreLogic’s Home Price Index in May 2019 indicated y/y increases every month for the last seven years, since March 2012, and that prices have increased +61.1% since hitting the trough in March 2011. Overall, the HPI is +8.3% higher than the pre-crisis peak in April 2006.
Despite these significant increases in home prices, supply levels among all price tiers remain challenged…so much so that homeowners question whether or not they can afford a replacement house if they were to sell. In the last three years, 25% residents in high priced markets bought homes while only 6% of residents sold. And, only 22% of residents say they plan to buy a home and only 7% of residents plan to sell.
California, Idaho and Michigan all surpassed pre-crisis home price peaks as of May 2019 while Connecticut remains the farthest below, -17.6%, its all-time HPI high at the market peak in July 2006.