Recent indices released this week found home prices skyrocketed in November at a rate just under 10%. For the S&P CoreLogic Case-Shiller 20-city price index, which focuses on the largest 20 metros in the country, home prices rose by 9.1% year over year in November. Just from October, home prices increased by 1.5%. Looking at the nation as a whole, home prices were 9.5% higher than a year ago, says Realtor.com. There are three metros that outpaced the national and 20-city averages: Phoenix, Seattle, and San Diego. Phoenix home prices increased by 13.8% compared to November 2019.
Phoenix experienced the largest price increase for the 18th consecutive month with a 13.8% increase, followed by Seattle (12.7%) and San Diego (12.3%).
Separately, the Federal Housing Finance Agency released its own monthly home price index for November. According to that report, home prices were up 1% from the previous month and 11% from November 2019. This is the sixth consecutive month in which home prices have risen, and annual gains are now outpacing the price growth seen during the last housing boom before the Great Recession, said Lynn Fisher, deputy direction of the division of research and statistics at the FHFA.
The big picture: While there may be evidence that demand among home buyers is waning from the heights reached this summer — as evidenced by lower mortgage application volumes — it still remains very strong. Plus, the supply of homes for sales is all but exhausted. The lack of inventory should continue to fuel home-price increases for foreseeable future, especially in popular markets such as Phoenix and Boise, Idaho.