U.S. home prices rose 7% in October compared with the same month a year ago, according to CoreLogic. The research firm had previously forecast a rise of 4.7%, more in line with the index jumps in for the first three months of the year. The data include sales of distressed properties. The 7% price gain matches the year-over-year September increase.
Month over month, October prices rose 0.9%, including distressed home sales. CoreLogic expects November housing prices to rise by 4.2% year over year by October 2018 and to dip by 0.2% month over month in November.
CEO Frank Martell noted:
The acceleration in home prices is good news for both homeowners and the economy because it leads to higher home equity balances that support consumer spending and is a cushion against mortgage risk. However, for entry-level renters and first-time homebuyers, it leads to tougher affordability challenges.
Chief Economist Frank Nothaft added:
Single-family residential sales and prices continued to heat up in October. On a year-over-year basis, home prices grew in excess of 6 percent for four consecutive months ending in October, the longest such streak since June 2014. This escalation in home prices reflects both the acute lack of supply and the strengthening economy.
Including distressed sales, home prices rose the most in Utah and Nevada (10.1%) and Washington (12.5%).
The 10 U.S. metropolitan areas posting the largest year-over-year increases in single-family house prices were:
- Las Vegas: 10.2%
- Denver: 8.3%
- San Francisco: 7.9%
- Boston: 7.0%
- Los Angeles: 7.0%
- Miami: 5.0%
- Washington, D.C.: 4.6%
- Chicago: 3.8%
- New York City: 3.6%
- Houston: 3.1%
Of these 10 metros, only three — San Francisco, Boston and Chicago — were rated “at value.” The other seven are rated as “overvalued.”
See the CoreLogic October report for more detail.