House prices are rising quickly, and have been for quite some time. This much is known. However, a new report shows that prices are rising faster than they have in more than four decades.
According to a new report from CoreLogic, home prices rose by 18% from October 2020 to October 2021. That growth matches the data from the Federal Housing Finance Agency House Price Index, which showed that home prices grew 18.05% from the third quarter of 2020 to the third quarter of 2021.
Growth of that size hasn’t been seen in more than 40 years. According to CoreLogic, the 18% growth seen in October was the highest ever recorded in the 45-year history of its house price index report.
However, CoreLogic notes that the monthly rate of increase (from September to October) has slowed from its peak seen earlier this year, signaling that home price growth could slow down in the coming months.
“New household formation, investor purchases and pandemic-related factors driving demand for the limited supply of available for-sale homes continues to propel the upward spiral of U.S. home prices,” said Frank Martell, president and CEO of CoreLogic. “However, we expect home price growth to moderate over the near term as many buyers take a break for the holidays.”
While home prices grew 18% from October 2020 to October 2021, home price gains are expected to slow to just 2.5% from October 2021 to October 2022, meaning that the frenzy seen over the last two years could soon subside a bit.
That would be welcome news to prospective buyers looking to buy a new home.