The housing market is in an astonishing state. The widely followed S&P CoreLogic Case-Shiller Home Price Index showed that home prices rose over 16% in May, compared to the same month last year. In Phoenix, they were up over 20%, and in some smaller towns and cities, the figure is much higher.
The rise in prices has been triggered by a surge in demand as people leave large east and west coast cities for places with what many people think is a better quality of life and lower living expenses. Working from home, brought on by the COVID-19 pandemic, has made this a widely adopted way to have a job without going to a corporate office. As demand has surged, supply has fallen. Builders have not been able to keep up. Those they have tried to have found that some essential building materials, like lumber, have jumped sharply in price.
Real estate property database company ATTOM has just released its second-quarter 2021 U.S. Home Sales Report. It shows the profits made by people who sold homes during the period. Nationwide, sellers made 44.9%, compared to what they paid for their homes. Todd Teta, chief product officer at ATTOM, characterized the current environment as a “housing market in high gear.”
ATTOM looked at 195 U.S. metropolitan areas. “Metro areas were included if they had at least 1,000 single-family home sales in the second quarter of 2021 and a population of at least 200,000.” In the second quarter, compared to the same quarter last year, the metro with the largest increase in profit for a sale over what the homeowner originally paid was Boise, Idaho, where the number was 123.4%.
The analysis does not provide a reason why Boise’s number was so high. One reason may be that it is a favorite place to move to for people who lived in large west coast cities. Another is simply the growth of the population overall. According to the Census Bureau, Boise had among the largest increases in population from 2010 to 2020, with a 24.94% gain to 770,353. That made it the 77th largest metro in the nation.
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