Written by Steven Hansen
CoreLogic’s Home Price Index (HPI) shows that home prices in the USA are up 7.0 % year-over-year year-over-year (reported up 1.4 % month-over-month). CoreLogic HPI is used in the Federal Reserves’ Flow of Funds to calculate the values of residential real estate. The quote of the day was in this data release:
The dream of homeownership continues to fade away for the average propective buyer
Analyst Opinion of CoreLogic’s HPI
CoreLogic year-over-year rate of growth has been steady for three years – with a higher number issued initially and later significantly downwardly revised in the following months. This months number will be reduced further in the coming months – and will end up near 6.0 % growth. According to CoreLogic:
…. revisions with public records data are standard, and to ensure accuracy, CoreLogic incorporates the newly released public data to provide updated results.
Note that CoreLogic forecasts:
The CoreLogic HPI Forecast indicates that home prices will increase by 5.2 percent on a year-over-year basis from March 2018 to March 2019, and on a month-over-month basis home prices are expected to be up 0.1 percent from March 2018 to April 2018.
Dr Frank Nothaft, chief economist for CoreLogic stated:
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.
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Frank Martell, president and CEO of CoreLogic stated:
The dream of homeownership continues to fade away for the average propective 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.
Caveats Relating to Home Price Indices
There is no such thing as an “accurate” home price index. CoreLogic HPI is a repeat sales type index which should not be skewed by changes in the mix of home sales. For more information, please read: http://www.philadelphiafed.org/research-and-data/publications/research-rap/2014/house-price-indexes.pdf
Source: CoreLogic
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