Home prices are up!
We are suddenly seeing the biggest gains in home prices in 2 years. Buyers are competing for home sales as the inventory is historically low. That strong demand for homes combined with record low mortgage rates is fueling this rapid price growth, reports Diana Olick, CNBC Real Estate Correspondent.
CoreLogic reports that nationally home prices in June and July are 5.5% higher than 2019. The average rate on 30 year mortgages fell below 3% for the first time in 50 years in July 2020. This gives buyers additional purchasing power.
“Lower-priced homes are sought after and have had faster annual price growth than luxury homes,” states Frank Nothaft, CoreLogic’s chief economist. “First-time buyers and investors are actively seeking lower-priced homes, and that segment of the housing market is in particularly short supply. “
The inventory of homes priced under $100k was down 32% annually in July according to National Association of Realtors. The supply of homes priced at $500k to $750k was down just 9%.
Home buying is gaining significant strength in more affordable suburban and rural areas as buyers are looking for more space for the new work-and-school-at-home economy.
