Article from Mortgage101.com
After several years of falling or stagnating home prices, things have finally starting rolling again in the housing market. Real estate data company CoreLogic reported this week that according to it index, U.S. home prices rose by 10.2 percent in February compared with last year at that time. That is the largest yearly jump in prices since March 2006 – almost seven years ago and during the height of the housing bubble. Prices are also up 0.5 percent compared with January, the twelfth straight gain in monthly prices.
“Home prices continued their march upward in February. Nationally, home prices improved at the best rate since mid-2006, marking a full year of annual increases and underscoring the ongoing strengthening of market fundamentals,” said Anand Nallathambi, president and CEO of CoreLogic in a statement. “Continued home price appreciation will provide fuel needed to drive further recovery in the home purchase market.”
So what’s causing the incredible growth rate? Certainly the improvement in the employment scene is helping as are investors who are clearing out the stock of foreclosures on the market. Shrinking inventory and low interest rates are also an aiding force. Perhaps one of the biggest factors though is just the self-perpetuating cycle of home prices. As home prices started to rise, millions of homeowners were no longer underwater on their mortgages and were finally able to sell. And that is happening en masse in the West
“The rebound in prices is heavily driven by western states. Eight of the top ten highest appreciating large markets are in California, with Phoenix and Las Vegas rounding out the list,” said Dr. Mark Fleming, chief economist for CoreLogic.
The states with the most price growth included Nevada with a 19.3 percent home price increase, Arizona with 18.6 percent, California with 15.3 percent, Hawaii with 14.6 percent and Idaho with 13.5 percent. There were 11 states total that saw double digit growth compared to the previous year. At the bottom were Delaware where prices fell 4.4 percent, Alabama with a decrease of 1.5 percent and Illinois with a fall of 1.0 percent.