We probably sound like a broken record at this point, but: Home prices are up! They rose 5.7% from January 2014 to January 2015, according to a new study.
According to the CoreLogic Home Price Index, which has tracked how tens of thousands of homes have sold and resold over the past 30 years, New York (+5.6%), Wyoming (+8.3%), Texas (+8.3%), and Colorado (+9.1%) all set new highs in the index. The HPI covers 7,267 ZIP codes (60% of total U.S. population) and 1,282 counties (85% of total U.S. population) in all 50 states and Washington, DC, and includes all sales types, including distressed (i.e., foreclosures and short sales).
Surprisingly, those distressed sales actually contributed to the price uptick—they’d been dragging home values down since 2008.
As homeowners continue to enjoy their low interest rates, and opt to stay put rather than list their homes for sale, inventory levels will remain tight, thus driving up prices.
Here are the highlights from the report:
- 27 states and the District of Columbia are within 10% of the prices they peaked at in 2005. That means home values for many owners are nearing values we haven’t seen since before the housing market collapse.
- The five states with the highest appreciation were Colorado (+9.1%), Michigan (+9%), Texas (+8.3%), Wyoming (+8.3%), and Nevada (+7.6%).
- Only Maryland (-0.3%) and Connecticut (-1.9%) saw price declines.
Home prices are expected to continue this upward trend and increase 5.3% from January 2015 to January 2016, according to the CoreLogic HPI Forecast. Likewise, Jonathan Smoke, chief economist at realtor.com®, has been projecting 2015 to continue the housing market recovery.