Falling interest rates have, at least for now, taken off some of the pressure of rising home prices in the affordability equation. The U.S. quarterly existing single-family median home price rose to a record $279,600 in Q2 2019, a 12-month gain of 4.3 percent according to the National Association of Realtors® (NAR).
The following table shows median home prices for the 38 Metropolitan Statistical Areas (MSAs) having a minimum 8.0 percent gain in value in the 12-month period ending Q2 2019. In addition also calculated are price changes for the past 2-year and 5-year periods. All but 16 of the 178 MSAs tracked by NAR posted some gain in the latest 12 months – even as little as $100.
Click here for a PDF showing these data for all 178 MSAs sorted by MSA name.
The next table is sorted by the median price gain for all MSAs posting at least a 40 percent increase in the past 5-years (60 months). In that same period, median single-family home prices rose a strong 32 percent.
Home equity accounted for 34.1 percent of the typical household’s net worth across the U.S. in 2015 according to U.S. Census Bureau data. While rising prices have resulted in increased equity and net worth for many families, those preparing to buy must overcome the hurdle of a higher entry ticket to homeownership.
Rising home values will likely continue on average as new household creations are running at a quicker pace than construction of residential properties – including rentals. As usual again I invoke the TINSTAANREM Clause — There Is No Such Thing As A National Real Estate Market. That said, expect home values and rents to continue the upward trek.