Home prices surged by 18.4 percent in October, latest data shows
S E E D E D C O N T E N T
U.S. home prices surged again in October, as the housing market continues to boom in the wake of last year's coronavirus recession.
The S&P CoreLogic Case-Shiller 20-city home price index, out Tuesday, climbed 18.4 percent in October from a year earlier. The gain marked a slight deceleration from a 19.1 percent year-over-year increase in September but was about in line with what economists had been expecting.
All 20 cities posted double-digit annual gains. The hottest markets were Phoenix (up 32.3 percent), Tampa (28.1 percent) and Miami (25.7 percent). Minneapolis and Chicago posted the smallest increases, 11.5 percent each.
The housing market has been strong thanks to rock-bottom mortgage rates, a limited supply of homes on the market, and pent-up demand from consumers locked in last year by the pandemic. Many Americans, tired of being cooped up at home during the pandemic, are looking to trade up from apartments to homes or to bigger houses.
It remains unclear if that shift is permanent or an aberration, said Craig Lazzara, managing director at S&P Dow Jones Indices.
"We have previously suggested that the strength in the U.S. housing market is being driven in part by a change in locational preferences as households react to the Covid pandemic,″ Lazzara said. "More data will be required to understand whether this demand surge represents an acceleration of purchases that would have occurred over the next several years, or reflects a more permanent secular change.″
More data will be required to understand whether this demand surge ... reflects a more permanent secular change.
Last week, mortgage rates fell — to 3.05 percent for the benchmark 30-year, fixed-rate and 2.66 percent for the 15-year fixed-rate home loan. The persistently low rates signal that credit markets appear more concerned about the omicron variant depressing economic growth than about the highest inflation rates in nearly 40 years.
The National Association of Realtors reported last week that sales of previously occupied homes rose for the third straight month in November to a seasonally adjusted annual rate of 6.46 million.
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In most cities in Florida, the housing market is red hot. In our retirement community, there are rarely more than 5 resales available at any given time. New home construction in our community has a wait of about a year after purchase to move in.
Yeah, it's just nuts. Worst part of this is the daily (and frequently multiple) daily calls from groups wanting to buy my house. Because I'm in a position at work where I am "on call" I cannot ignore a phone call. Looking forward to when I retire and can ignore calls from numbers I do not recognize.
While I wouldn't mind moving when I retire, I have no desire to spend that much money on a home in retirement.
They want to buy your house but nobody tells you where you're going to live if you sell
Most houses around here don't tend to stay on the market very long as we have a serious housing shortage especially in the 3 & 4 bedroom range. They are often going for well over asking price too.
Other interesting articles on the housing market:
I read that Zillow was selling thousands of houses at a loss because they over purchased -
New type of home lender let's individuals compete with all cash purchases -
I always wondered how Zillow can estimate the worth of a house from a picture on Google maps.
Mine is way undervalued compared to the others around me. I think they use the last purchase price (which they did in my case) and some neighboring homes that sold within the last few years and take into consideration other homes in the area. I made my purchase agreement last December from an appraisal done by the owner October of 2020 and by the time we closed the end of March, the appraisal had increased by $28K. Now in the last 7 months, due to the housing shortage in the area, it has gained another $25K.
They say they use some kind of algorithm. It's the same with those new lenders I posted. They can pre-approve a purchaser and home purchase in hours.
It's like Zillow has become the Tax Assessor here...
It could easily be people trying to get out of the cities for a more open environment as a hedge against covid...
The Real Estate markets are always reporters of great change in a society... And generally go upwards when there is political strife or a serious schism in the security feelings of the individual...
And this nation is nothing but schisms now...
Actually, most major cities in FL are in double digit price growth.
My son lives in Navarre and his home value has gone up at least 50% in the last year or so. He's hoping to come back to Arkansas so if he can get a good price on his house, he'll be able to buy more house for the money when he comes home
As is happening here in the greater Puget Sound area as well... My tax assessed valuation has doubled over the last year... and people are leaving Seattle as fast as they can afford to..
Hopefully it works out for him.
Me, too. I want him to come home
Doubtful. There's really only a few people who enjoy country living. That's why there are more people living in cities
I don't mind being in the country but not full time. I could not live having to drive 20 miles just to go to a grocery store.
I am spoiled. Anything I want within a five minute radius.
I have the best of both worlds. I live on 3 acres surrounded by woods in a quiet subdivision where the smallest lot is 1.5 acres. And walmart is less than 10 minutes away. The only thing I dislike is the 60 mile round trip commute I have every day
I was searching for tiny homes in my area and found only 1 for sale which was a 40 min drive into town, way up in the hills, 425 sq ft one bedroom one bathroom built in 1988 and costs only $295,000 which is a steal in this area. Here's the photo:
Another house four blocks from my office is for sale which is a 2 bedroom 3.5 bath 1700 sq ft Mediterranean-style home with ocean views from the upper floor originally built in 1929, remodeled in 2005 and the asking price is just $9,000,000.
Maybe I'm not getting a clear picture here...but I've seen these "tiny homes" before....in little podunk towns in Arkansas and Louisiana...
This one is way up in the hills of Carmel Valley, CA.
There used to be more of these little shacks that were built in the 1970's and 1980's but any that were even somewhat close to town have been torn down and had larger homes built on the land. In an area that is a bit closer to town, about 30 min drive, a 1000 sq ft home runs about $800k. The ones right in town are usually 1250 to 1500 sq ft and run between $3M to $6M.
One of my clients (I work for a home insurer) bought a 1450 sq ft two bed two bath home four years ago for $1.2M then spent $1M remodeling it and sold it last month for $4.6M.
Thank-you for calling it a shack. I didn't want to offend anyone.
yeah, they then move up here to the PNW and get twice that sqft for half the money in the richest part of town...
I have a townhouse in Huntington Beach, CA. 1686 sq ft and recently (Nov 2020) appraised for $1.4 million. It's a block from Bolsa Chica beach. I bought it in 1983 for $165,000. Grandfathered in under prop 13 so my property taxes are less than $3,000 a year.
Nice...
It will be the kids inheritance and they can do what every they choose with it when the time comes.
my mom bought her little condo for $40K twenty years ago. she has an unobstructed view of the gulf. we had to disconnect her landline last year because of all the realtors calling day and night offering insane amounts of cash for it.
One thing that I learned when we were not able to purchase a home is that I rarely sell any real property. I still have the first home I ever bought in Downey, CA in 1968.
Your not the only one that has learned that, real estate keeps me living comfortably as well... I think I was 20 when I found out that the first property my parents bought for $2,000, was worth 20,000 at the time, it's now worth 487 thousand today... AS long as you can handle the tax service, (expense) Real Estate has been the best investment I've ever made...
Amazing how quick some are to waste their money on a shack, basically.
California must be great if you are rich.
Not too good for anyone else.
Well, except illegal aliens, then it is great for them, too.