In August, home prices in the United States experienced a 3.7% increase compared to the previous year, according to a report released by CoreLogic on Tuesday. The median sales price for a single-family home reached $375,000 during this period. Notably, the New England states emerged as the leaders in housing market growth.
The New England Advantage
Among all states, New Hampshire witnessed the most significant surge in home values in August, with an impressive growth rate of 9.4%. Following closely behind were Maine and Vermont, both experiencing an 8.9% increase in home values. This growth has sparked the observation that housing markets in New England are becoming increasingly vibrant.
Leading the Nation
A report published by the Federal Housing Finance Agency revealed that the New England region achieved the highest annual home-price gains as of July 2023. It is important to note that these findings lag behind CoreLogic's data by one month.
Furthermore, it is worth mentioning that California holds the distinction of having the highest median sales price for a single-family home, standing at $705,000. Following closely behind are Washington D.C. with $630,000 and Massachusetts with $585,000 respectively, according to CoreLogic's analysis.
Looking ahead, CoreLogic anticipates that annual home-price growth will reach 3.4% by August 2024.
However, financial pressures are mounting for home buyers due to mortgage rates currently at 7.61% as of Oct. 2, as reported by Mortgage News Daily. Affordability becomes a concern as home prices rise.
"With a slower buying season ahead and the surging cost of homeownership, additional monthly price gains may taper off," explains Selma Hepp, chief economist at CoreLogic.
Data Analysis Methodology
CoreLogic derives its insights regarding home-price trends by conducting extensive analysis using public records, servicing and securities information, real-estate databases, as well as repeat-sales transactions.
While New England exhibits robust growth, some Western states encounter a decline in home prices. In fact, eight states reported a drop in home prices, with Idaho experiencing a 4% decline, followed by Montana at 2.7% and Nevada at 2.3%. Additionally, New York, an eastern state, saw home prices fall by 0.2% in August compared to the previous year.
Markets at Risk
According to CoreLogic, the top three markets at risk of a drop in home prices are Spokane-Spokane Valley in Washington, Cape Coral-Fort Myers in Florida, and Youngston-Warren-Boardman in Ohio-Pennsylvania.
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