Key Highlights
- Case-Shiller Home Price Index in 2020 increased +8.41%
- Strongest Home Price Index since March 2014
- Home sales clocked strongest year since 2006
Both home prices and sales were surprisingly spectacular in 2020. The S&P CoreLogic Case-Shiller indicated that its Home Price Index (HPI) jumped +8.41% in October, a new high and fastest pace since March 2014. The HPI is now +25% above the pre-Great Recession peak plus the month-to-month index increased +1.7% from September, the fastest home price increase since spring of 2013.
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Home sale volume in 2020 ticked up higher than in 2019 and logged the strongest year since 2006. Looking forward to 2021, CoreLogic is anticipating even higher sales activity in the first two quarters of the new year based upon data from mortgage purchase applications and pending sales.
October’s home prices came in +25% higher than previous peaks reached between 2004 and 2009. Seven cities within CoreLogic’s 20-city composite indexes saw home prices rise +30%. That being said, 4 metro areas are seeing their home prices lag behind previous pre-Great Recession peaks with Las Vegas being the slowest to “catch up.” Even Phoenix, the leader in home price growth for the last 17 consecutive months, remains -2% below its previous pre-Great Recession peak.
Homes in the lower one-third-price tier continued to experience the highest demand from buyers. Homes in this tier experienced an average annual home price growth rate of +10.5%. Low-tier home prices in Phoenix saw a +15% jump while even low-tier home prices in both Las Vegas and Miami saw annual increases of +7%.
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The average annual price growth among medium-tier prices homes was +9.5% in 2020 and the average annual price growth among highest-tier prices came in at +8.1%
As said up top, CoreLogic is quite optimistic that the early months of 2021’s housing market will continue to deliver meaningful plus-sides to the US housing markets in both sales and price growth despite “…bumps along the way to economic recovery.” The COVID vaccinations are on their way to peoples’ arms though slower than expected; depending on the path and magnitude of COVID infections, and, lockdowns may be prevalent. But, policymakers coming into the nation’s capital in later January may further extend eviction and foreclosure moratoria and recent stimulus actions “…are likely to help housing market demand and ensure continued home price growth.”
Thanks to CoreLogic.
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