Monday, May 7, 2018

Home Prices Rise

home prices rise
CoreLogic recently released its U.S. Home Price Insights (HPI) report to the public. This report is designed to provide the industry with a quick look at home price trends. It incorporates more than 40 years of repeat sales transactions to analyze pricing trends.

In March 2018, nationwide home prices which included distressed sales rose 7 percent over 2017 and increased 1.4 percent between February and March 2018. The HPI also reports that home prices will increase between March 2018 and March 2019 by 5.2 percent. The expected increase between March and April 2018 is expected to be 0.1 percent.

CoreLogic’s Chief Economist Frank Nothaft says,
“Home prices grew briskly in the first quarter of 2018. High demand and limited supply have pushed home prices above where they were in early 2006. New construction still lags historically normal levels, keeping upward pressure on prices.”

CoreLogic’s market condition indicator is showing that one half of the top 50 U.S. markets are overvalued. President and CEO, Frank Martell says,
“The dream of homeownership continues to fade away for the average perspective buyer. Lower-priced homes are appreciating much faster than higher-priced properties, making the affordability crisis progressively worse. CoreLogic’s Market Condition Indicators now indicate that half of the top 50 markets in the country are overvalued because home prices in those areas have risen so much faster than incomes. This is clearly an unsustainable condition that can only be remedied by aggressive and coordinated public/private section actions.”
The HPI reports provides a map of the U.S. with percent changes and shows that South Carolina has had a 3-6 percent change year-over-year to March 2018. My guess is that the higher percentages would be for places like Charleston. The future forecast still shows South Carolina between 3-6 percent through March 2019. This shows a steady growth pattern but luckily not a high growth like the western and north eastern states. Texas and North Dakota are the only two states showing a change of 0-3 percent.

The closest top U.S. Metro Area to Greenville SC is Washington D.C. which is at 2.5 percent year-over-year change. The HPI report shows the Market Conditions Indicators Metro Area Maps for the Greenville-Anderson-Mauldin metro area we see that the current market is in the normal range but predicted to be overvalued by March 2023. Our neighboring Spartanburg market is showing normal with predictions for it to stay normal through March 2023. The Columbia SC market is currently showing undervalued and predicted to stay that way to March 2023. Conversely, Charleston-North Charleston is overvalued and predicted to stay that way to March 2023.

It will be interesting to see how close the predictions in this report parallel the actual sales numbers and prices returned each year by the local MLS. If builders continue to be hesitant about getting back into the market and building replacement housing the numbers will stay high.

However, developers in Greenville have many plans for adding homes to the area in the next 5 years. If building can come back full scale, home prices may level out or dip back to affordable.

And remember if you, a friend or family member need assistance with selling or buying a home I can help. Referrals and people needing relocation assistance are welcome! Search Single Family homes in Greenville. Search Condos and Townhomes in Greenville.