CoreLogic's report on April home prices says that despite fears that home prices would "bottom out like they did in the Great Recession," they continued to accelerate, reaching their highest annual growth since August 2018. The U.S. CoreLogic HPI was up 5.4 percent compared to April 2019, with gains in all states and rose 1.4 percent compared to the previous month. Purchase activity, particularly among millennials, bounced back in April as the economy began to open back up. Gains were also driven by low inventory of homes especially at the entry level. Those plummeted by 25 percent on average nationally. However, the company cautions that the economic effects of the recession will continue to make themselves known over the next 12 to 18 months - and it expects that 2021 will bring the first decline in home prices in nine years. Still, the early rebound "indicates the housing market may be equipped to lead the broader economy through the recovery." The HPI Forecast predicts the U.S. index will fall 1.3% from April 2020 to April 2021. CoreLogic's Market Risk Indicator (MRI), a monthly update of the overall health of housing markets across the country, predicts a high probability that areas hit by downturns in tourism and oil and gas will experience largest home price declines.
Source: Mortgage News Daily