Home prices rose 6.6% in May compared with the same month a year ago, according to CoreLogic. The research firm previously had forecast a rise of 5.1%, more in line with the index jumps in for the first three months of the year. The data include sales of distressed properties.
Month over month, May prices rose 1.7%, including distressed home sales. CoreLogic expects June housing prices to rise another 5.3% year over year and to rise by 0.9% month over month.
CEO Frank Martell noted:
For current homeowners, the strong run-up in prices has boosted home equity and, in some cases, spending. For renters and potential first-time buyers, it is not such a pretty picture. With price appreciation and rental inflation outstripping income growth, affordability is destined to become a bigger issue in most markets.
Chief Economist Frank Nothaft added:
The market remained robust with home sales and prices continuing to increase steadily in May. While the market is consistently generating home price growth, sales activity is being hindered by a lack of inventory across many markets. This tight inventory is also impacting the rental market where overall single-family rent inflation was 3.1 percent on a year-over-year basis in May of this year compared to May of last year. Rents in the affordable single-family rental segment (defined as properties with rents less than 75 percent of the regional median rent) increased 4.7 percent over the same time, well above the pace of overall inflation.
Including distressed sales, home prices rose the most in Utah (10.4%) and Washington (12.6%).
The 10 U.S. metropolitan areas posting the largest increases were:
- Denver: 9.2%
- San Diego: 7.3%
- Las Vegas: 7.3%
- Los Angeles: 6.4%
- Boston: 6.3%
- Washington, D.C.: 4.7%
- San Francisco: 4.6%
- Chicago: 4.4%
- Miami: 4.4%
- Houston: 2.2%
See the CoreLogic May report for more information.