Home Prices Jump the Most in 7 Years

The housing recovery may have hit its strongest point yet. New data Tuesday show home prices in May were up 12.2 percent from a year ago, the biggest jump since February 2006.

The most recent data from real estate data firm CoreLogic show not only that price growth has accelerated but that the housing recovery has taken hold across much of the U.S. Home prices grew in 48 states and the District of Columbia in May, with declines only seen in Delaware, where prices fell by 0.6 percent year over year, and Alabama, where prices fell by 0.1 percent.

Leading the upward swing in home prices are Nevada, which posted price growth of 26 percent; California, with 20.2 percent; and Arizona, at 16.9 percent growth. Those three states were among the hardest hit by the housing crisis.

According to CoreLogic’s data, home prices have been growing since March 2012, which one company analyst says is largely due to a dwindling supply of houses.
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YOUR CALL TO ACTION
If you’re looking to buy or sell a house in Utah, please call or text me (Patrick Wiscombe) at (801) 874-7717.
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That decline in inventory is a far cry from the post-bubble period, when scores of homes in hard-hit areas sat empty.

The supply of homes has dwindled for several reasons. One is that the population has grown while construction has slowed, meaning more growth in demand than supply. In addition, some homes are off the market because they are going through foreclosure or are bank-owned. In addition inventory further tightened as a result of rising prices.

While prices have been on a healthy upswing, they remain far from where they were before the crash. Prices are 20.4 percent below their April 2006 peak, but that may be a poor standard by which to measure the recovery.

Prices may see some downward pressure in coming months due to rising mortgage rates. Lender Freddie Mac recently reported that the average 30-year fixed mortgage rate hit nearly 4.5 percent in its June 27 Primary Mortgage Market Survey – up more than half a percentage point from just the week before, when it was 3.93 percent, and up 0.8 percentage points from one year prior.

That’s the largest one-week jump in 26 years, and it may mean buyers will buy less expensive homes than they would have when rates were at historic lows.

Credit: U.S. News World & Report

PATRICK’S OPINION: Assuming you’ve read my marketing tagline at the top of my blog, “I sell houses in 60 days or less,” what I’m seeing in Utah, as of today’s blog post, is that houses priced at $250,000 and less are getting multiple offers very quickly. Let me define quickly. As soon as I list your house on the MLS and stick a ‘For Sale’ sign in the ground on your property, generally speaking I start getting calls within 24 hours and have an offer, if not multiple offers, on a property within 3 – 7 days. So, when people ask me if they think their house will sell, yes it will.

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YOUR CALL TO ACTION
If you’re looking to buy or sell a house in Utah, please call or text me (Patrick Wiscombe) at (801) 874-7717.
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