Home prices across the United States are continuing their relentless trek higher.
According to Fox Business, Realtor.com’s latest Monthly Housing Trends Report said the national median home price reached another record high of $405,000, which is up 13.5 percent from the year before. Compared to the start of the coronavirus pandemic in March 2020, the median home price is up an eye-opening 26.5 percent.
Moreover, the latest S&P CoreLogic Case-Shiller US National Home Price Index showed that home prices climbed 19.2 percent in January year-over-year—up from an 18.9 percent annual increase seen in December.
“The monthly payment for a median-priced home has jumped 30 percent in the past year, far outpacing even fast-rising consumer prices, up almost 8 percent from a year ago,” George Ratiu, senior economist at Realtor.com, said in a statement.
Debbie Boyd, CEO at DLB Financial Services, told Yahoo Live that a “perfect storm” continues to drive up home prices.
“We've got COVID that did the supply chain problems … COVID that drove people to work from home. They're moving to states where their families are or they're just moving to states that are prettier and they want to be in. Now that you can work anywhere, it really has changed the game of employment,” she added.
Relief on the Way?
Despite the surging prices, Realtor.com’s chief economist Danielle Hale said some relief could be on the way in the near future.
“Buyer demand is moderating in the face of high costs, and we’re beginning to see more homeowners take price cuts on their listings and overall inventory declines lessen in response,” she said in a statement.
“Assuming all these factors and new construction hold steady, we could begin to see inventory increases this summer—welcome news for buyers who have endured pandemic home shopping and can continue their journey despite higher buying costs. For buyers currently in the market, there's good reason to aim to find a home before interest rates increase further. But if it takes longer than a few months, don't give up hope, as there may be more to choose from in the summer months,” she continued.
Boyd said that with rising mortgage rates entering the picture, it will likely impact how much house a potential home-buyer can afford.
“You're going to get less house now than you could last year by quite a bit of percentage. So yes, can you move to Miami proper? Maybe not. Maybe you can't afford to be in the city now. The prices are 30 percent more than they were last year. So you're going to be in the suburbs of Miami. It's going to change the way that we live,” she said.
“I think (the housing market) will cool off in a little while, but not any time soon. I think this year, we're going to see close to 6 percent,” she concluded.
Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.