CoreLogic reports that December saw yet another acceleration in home price increases. The company’s Home Price Index (HPI) rose 9.2 percent on an annual basis. The increase in November was 8.2 percent. The month-over-month change, 1.1 percent, was also greater than the increase from October to November, 1.0 percent. CoreLogic says the December data means the housing market closed out the year with the highest annual price gain since February 2014, far exceeding expectations. Other than a “blip” in April reflecting the initial shock of the pandemic, home-purchase demand surged as record-low mortgage rates persuaded first-time homebuyers to enter the market. COVID-19, however, did serve to damp down the supply of homes. Inventories dropped, on average, 24 percent below 2019 levels as homeowners delayed selling.
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