Homeowners are seeing the biggest increase in equity in six years. Gerri Willis from FOX Business with more.
US house prices rose in October at their fastest pace in more than six years, as a run out of city centers resulted in the lowest number of properties listed for sale on record.
House prices rose 8.4% year on year in October, according to the national Case-Shiller index, the highest since March 2014. Prices are now 25% above the peak reached before the 2008 financial crisis.
“The data for the past few months is consistent with the view that COVID-19 has encouraged potential buyers to move from urban apartments to suburban homes,” said Craig Lazzara, managing director of S&P Dow Jones Indices, in a statement.
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The composite index of 20 cities found that prices increased 7.9% compared to the previous year, in October, compared to the 6.6% gain of the previous month.
All 19 cities that reported registered price increases month by month in October. Delays in local reporting in Wayne County, Michigan, due to COVID-19 restrictions, meant that Case-Shiller was unable to report an accurate reading for the Detroit metropolitan area in October.
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Phoenix reported the biggest annual gain with rising prices of 12.7%, followed by Seattle and San Diego, which saw price increases of 11.7% and 11.6%, respectively.
New York reported the smallest gain, 6% more than a year ago. Chicago was next with a 6.3% increase.
The coming year will bring new challenges for the economy and the housing market as new restrictions on COVID-19 are applied, according to Selma Hepp, CoreLogic’s deputy chief economist.
However, the recently approved $ 900 billion stimulus package and lawmakers who can extend foreclosure moratoriums will “help demand for the housing market and ensure continued growth in house prices,” she said.