US house price growth accelerated in the last month of 2020 – the fastest pace in eight years. The results complete what was a record year for the housing market, despite the COVID-19 pandemic.
Standard & Poor’s said on Tuesday that its national S&P CoreLogic Case-Shiller home price index posted an annual gain of 10.4% in December, down from 9.5% in November – the fastest growth rate since 2013 The 20-City Composite recorded an annual gain of 10.1%, up from 9.2% in the previous month – exceeding estimates of a 9.90% gain year on year, according to the consensus compiled by Bloomberg.
“House prices ended 2020 with double-digit gains. The accelerating price trend that started in June 2020 has now reached its seventh month, ”said Craig J. Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices, in a press release. He noted that the annual gain for December is in the top decile of all of his reports, which date back more than 30 years.
“The strength of the market continues to have a broad base: 18 of the 19 cities for which we have data for December have increased and 18 cities have earned more in the 12 months ending in December than they have gained in the 12 months ending in November,” Lazzara said.
Once again, Phoenix led the 20-City Composite for the 19th consecutive month, showing an annual gain of 14.4%. Seattle and San Diego continued to post an increase of 13.6% and 13% year on year, respectively.
Last year, house prices decelerated in May and June due to the COVID-19 blockade, but this quickly reversed in the summer, as historically low interest rates and pent-up demand fueled real estate activity.
“Persistent buyer demand in the midst of a low supply housing market has undeniably pushed home prices to new heights in 2020. The continued decline in mortgage rates to new record lows, especially in December, also helped to expand the cash flow. accessibility for some buyers and allowed them to bid at higher prices than they would have been able to if rates were higher – also further accelerating price growth, ”said CoreLogic Deputy Chief Economist Selma Hepp in a prior to the results. “Looking ahead, for 2021, pressure on home prices is likely to remain strong until mortgage rates rise or more homes are available for sale.”
Last week, the National Association of Realtors reported that the average selling price of an existing home increased 14.1%, to $ 303,900 in January, at the same time last year. He also said the number of homes for sale reached an all-time low in January.
“The housing market continues to be well supported by low interest rates, restricted supply and a shift in demand to the suburbs and low-cost cities, where home ownership is more affordable,” Nomura said in a research note prior to the results. “This should keep pressure on home prices.”
Amanda Fung is an editor at Yahoo Finance.
Read More
Pending home sales end 2020 slightly down
The growth of residential prices reaches the highest level since 2014
The hottest real estate market of 2020
Follow Yahoo Finance on Twitter, the Facebook, Instagram, Flipboard, SmartNews, LinkedIn, You Tube, and reddit.
Find live stock market quotes and the latest business and finance news