U.S. Home Prices Are Rising At An Accelerating Pace
The median sales price for existing homes in each of more than 180 metro areas tracked by the National Association of Realtors rose in the fourth quarter from a year earlier ( the second consecutive quarter ). In the fourth quarter, 161 metro areas posted double-digit-percentage price increases, up from 115 metro areas with double-digit gains in the third quarter. Home sales in 2020 rose 5.6% to the highest pace since 2006, NAR said.
“People are willing to move farther out because they only have to go to the office once or twice a week, or month,” said Richard Whiteley, co-president and chief operating officer at IHP Capital Partners, which invests in new-home construction and land development. “There’s a race for space.”
The biggest home-price gainers in the fourth quarter were in the Northeast, led by the area around the seaport city of Bridgeport, Conn., where prices shot up 39.2% from a year earlier. In Pittsfield, Mass., they rose 32.2%, while in the coastal resort town of Atlantic City, N.J., home prices gained 30%. In the fourth quarter, the typical monthly mortgage payment ticked upward to $1,040, from $1,020 a year earlier, NAR said, even as mortgage rates declined.
“It is increasingly becoming concerning, about potential first-time buyers,” said Lawrence Yun, NAR’s chief economist. “With prices rising, it simply is kicking them out of the buying pool.”