CoreLogic Home Price Insights (HPI) reported today that home prices did heat up this year. Across the country prices rose by 7% from September 2016 to September 2017. The numbers also showed an increase from August to September of this year by .09%. These figures include distressed sales.
An interesting tidbit about the CoreLogic HPI is the data incorporates more than 40 years of repeat-sales transactions for analyzing home price trends. The CoreLogic HPI forecast for the coming year shows an anticipated increase in home prices by 4.7%.
Frank Nothaft, acquaintance and former Freddie Mac Chief Economist, now Chief Economist for CoreLogic says, “heading into the fall, home price growth continues to grow at a brisk pace. This appreciation reflects the low for-sale inventory that is holding back sales and pushing up prices. The CoreLogic Single-Family Rent Index rose about 3 percent over the last year, less than half the rise in the national Home Price Index.” Smh, Nothaft does not live in North Texas. Still, he is an incredibly smart guy and this is the national number afterall.
So…what does Texas look like? Home prices are up 5.64% from September 2016 to this September. The forecast is for continued growth, but moderating over the next year with 2.42% expected, Sept to Sept.
Black Knight also released some interesting data today which may seem a bit counterintuitive. Black Knight reports home affordability improved in September. The average homeowner needs 21.4% of their median income to purchase a home. This is less than the post-recession peak of 21.7%. It much lower than the years prior to the housing boom, from 2000 to 2003, when affordability was at 26.2%.
So, despite the increase in home prices, home affordability is looking sunny.
Finally, the last piece of housing news for today from The National Association of Realtors (NAR). This year has fallen short on availability of homes on the market NAR predicts that sales of existing homes will grow by 3.7% in 2018 to a target of 5.67 million homes. This is greater than the estimated 5.47 million homes projected for 2017.
There you have it. Home prices continue to rise. Surprisingly, affordability is still in the game. And next year we shall have more homes available for buyers. Perhaps that is the reason the forecast for price appreciation is moderating.