Millennials Propel Home Buying: Strong Demand and Short Supply Push US Home Prices Higher in March, CoreLogic Reports
04 Maggio 2021 - 2:00PM
Business Wire
- CoreLogic Home Price Index recorded an 11.3% annual gain, the
highest since March 2006
- Mountain-West and Sun Belt regions see heightened
year-over-year growth
CoreLogic® (NYSE: CLGX), a leading global property information,
analytics and data-enabled solutions provider, today released the
CoreLogic Home Price Index (HPI™) and HPI Forecast™ for March
2021.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20210504005382/en/
CoreLogic National Home Price Change and
Forecast; March 2021 (Graphic: Business Wire)
As consumer confidence rebounds and the job market picks back
up, the 2021 spring homebuying season is on track to outpace trends
seen in 2019 and 2018. Millennials lead the homebuying charge with
older millennials seeking move-up purchases and younger millennials
entering peak homebuying years. As we look towards the second half
of the year, further erosion of affordability may dampen purchase
demand as prospective buyers continue to compete for the severely
limited supply of for-sale homes. A pickup in construction and an
increase in for-sale listings as more people get vaccinated may
help moderate surging home price growth.
“Despite the severe slowdown last year, the 2021 spring
homebuying season is trending strong — reflecting the many positive
signs of economic recovery,” said Frank Martell, president and CEO
of CoreLogic. “With prospective buyers continuing to be motivated
by historically low mortgage rates, we anticipate sustained demand
in the summer and early fall."
Top Takeaways:
- Nationally, home prices increased 11.3% in March 2021, compared
with March 2020. On a month-over-month basis, home prices increased
by 2% compared to February 2021.
- Home prices are projected to increase 3.5% by March 2022, as
intensifying affordability challenges narrow the pool of potential
buyers and are likely to drive a slowdown in home price
growth.
- In March, home prices rose sharply in the West with seven of
the 10 metros ranked with the highest year-over-year increases.
Boise, Idaho, ranked at the top with a year-over-year increase of
27.7%.
- Similarly, at the state level, two Mountain-West states — Idaho
and Montana — had the strongest price growth in March, up 25% and
18.8% respectively, as they continue to see an uptick in inbound
migration from buyers moving away from more costly coastal areas.
Arizona had the third-strongest price growth with an 18%
increase.
“Lower-priced homes are in big demand and short supply, driving
up prices faster compared to their more expensive counterparts,”
said Dr. Frank Nothaft, chief economist at CoreLogic. “First-time
buyers seeking a starter home priced 25% or more below the
local-area median saw prices jump 15.1% during the past year,
compared with the overall 11.3% gain in our national index."
The next CoreLogic HPI press release, featuring April 2021 data,
will be issued on June 1, 2021 at 8:00 a.m. ET.
Methodology
The CoreLogic HPI™ is built on
industry-leading public record, servicing and securities
real-estate databases and incorporates more than 45 years of
repeat-sales transactions for analyzing home price trends.
Generally released on the first Tuesday of each month with an
average five-week lag, the CoreLogic HPI is designed to provide an
early indication of home price trends by market segment and for the
“Single-Family Combined” tier, representing the most comprehensive
set of properties, including all sales for single-family attached
and single-family detached properties. The indices are fully
revised with each release and employ techniques to signal turning
points sooner. The CoreLogic HPI provides measures for multiple
market segments, referred to as tiers, based on property type,
price, time between sales, loan type (conforming vs.
non-conforming) and distressed sales. Broad national coverage is
available from the national level down to ZIP Code, including
non-disclosure states.
CoreLogic HPI Forecasts™ are based
on a two-stage, error-correction econometric model that combines
the equilibrium home price—as a function of real disposable income
per capita—with short-run fluctuations caused by market momentum,
mean-reversion, and exogenous economic shocks like changes in the
unemployment rate. With a 30-year forecast horizon, CoreLogic HPI
Forecasts project CoreLogic HPI levels for two tiers —
“Single-Family Combined” (both attached and detached) and
“Single-Family Combined Excluding Distressed Sales.” As a companion
to the CoreLogic HPI Forecasts, Stress-Testing Scenarios align with
Comprehensive Capital Analysis and Review (CCAR) national scenarios
to project five years of home prices under baseline, adverse and
severely adverse scenarios at state, metropolitan areas and ZIP
Code levels. The forecast accuracy represents a 95% statistical
confidence interval with a +/- 2% margin of error for the
index.
About Market Risk Indicator
Market Risk Indicators are a subscription-based analytics
solution that provide monthly updates on the overall “health” of
housing markets across the country. CoreLogic data scientists
combine world-class analytics with detailed economic and housing
data to help determine the likelihood of a housing bubble burst in
392 major metros and all 50 states. Market Risk Indicators is a
multi-phase regression model that provides a probability score
(from 1 to 100) on the likelihood of two scenarios per metro: a
>10% price reduction and a ≤ 10% price reduction. The higher the
score, the higher the risk of a price reduction.
About the Market Condition Indicators
As part of the CoreLogic HPI and HPI Forecasts offerings, Market
Condition Indicators are available for all metropolitan areas and
identify individual markets as “overvalued,” “at value,” or
“undervalued.” These indicators are derived from the long-term
fundamental values, which are a function of real disposable income
per capita. Markets are labeled as overvalued if the current home
price indexes exceed their long-term values by greater than 10%,
and undervalued where the long-term values exceed the index levels
by greater than 10%.
Source: CoreLogic
The data provided are for use only by the primary recipient or
the primary recipient's publication or broadcast. This data may not
be resold, republished or licensed to any other source, including
publications and sources owned by the primary recipient’s parent
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CoreLogic data used for publication or broadcast, in whole or in
part, must be sourced as coming from CoreLogic, a data and
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For questions, analysis or interpretation of the data, contact Amy
Brennan at newsmedia@corelogic.com. Data provided may not be
modified without the prior written permission of CoreLogic. Do not
use the data in any unlawful manner. The data are compiled from
public records, contributory databases and proprietary analytics,
and its accuracy is dependent upon these sources.
About CoreLogic
CoreLogic (NYSE: CLGX), the leading provider of property
insights and solutions, promotes a healthy housing market and
thriving communities. Through its enhanced property data solutions,
services and technologies, CoreLogic enables real estate
professionals, financial institutions, insurance carriers,
government agencies and other housing market participants to help
millions of people find, buy and protect their homes. For more
information, please visit www.corelogic.com.
CORELOGIC, the CoreLogic logo, CoreLogic HPI and CoreLogic HPI
Forecast are trademarks of CoreLogic, Inc. and/or its subsidiaries.
All other trademarks are the property of their respective
owners.
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Amy Brennan newsmedia@corelogic.com
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