For more information, please contact me at (512) 261-1542 or steve@LoneStarLending.com.
By G. Steven Bray
Home price increases are accelerating again, so says Corelogic, a leading real estate data provider. It reported that its Home Price Index is increasing again on a month-over-month basis. In fact, the index rose 0.9% from May to Jun alone. Corelogic reported the annual increase was 3.6%.
Analyzing the reasons for the increase, Corelogic suggests lower mortgage rates may be the culprit. Rates for fixed-rate mortgages have fallen by nearly one percent since last fall.
Another reason may be homeowners’ reluctance to sell. As home prices rise, homeowners are questioning their ability to afford a replacement home, especially one in the same area. In a survey in higher-priced markets, Corelogic found three times as many people planning to buy as sell. Simple economics says that situation will put pressure on home prices.
While the current home price index remains near its recent low, Corelogic forecasts that it will rise above 5% again in the next few months. Even with continued low interest rates, that is likely to exacerbate the housing affordability problem, especially for moderate income homebuyers.