Homes in the USA are still playing catch-up with peak prices set more than 10 years ago despite seeing values rise for 52 months in a row.
The US housing crisis wiped millions of dollars off the value of private homes, and prices are not expected to equal the average peak price last seen in April 2006 until at least September 2017.
That’s the view of housing analysts at market research firm CoreLogic.
The latest house price report for the USA, which details market activity in May, showed values increased by 1.3% from April and 5.9% year-on-year.
The forecast for home values is a rise of 0.8% in June and that prices will continue to increase by 5.3% by May 2017.
Stable market persists
“The housing market remained stable in May,” said CoreLogic’s chief economist Dr Frank Nothaft.
“Home prices have risen between 5% and 6% year-on-year for almost two years in a row. This consistent solid growth is driven by aa tight supply of homes coming to the market and a lot of home owners wanting to move.”
On average, US house prices are still languishing 7.2% below the April 2006 peak level. Although 22 states have reached new record heights, three have posted falling prices and the rest are still at pre-peak levels.
The five states posting the largest year-on-year house prices rises are Oregon (11%), Washington (10.1%), Colorado (9.4%), Nevada (7.8%) and Utah (7.5%).
The states with falling prices are Connecticut (-0.9%), New jersey (-0.02%) and Pennsylvania (-0.01%).
The five states with prices farthest off the April 2006 peak are Nevada (-32.7%), Florida (-24.3%), Arizona (-23.9%), Rhode Island (-22.4%) and Maryland (-21.8%).
The report suggests more than 105 local property markets are overvalued by more than 10%, with 16 in Texas.
Nevada has the highest forecast percentage price change for the year of 10.4%, followed by California at 9.7%.
The top overvalued metropolitan areas are Denver, with house prices rising 10.3% in the past year, followed by Los Angeles (6.9%), Miami (5.9%), Houston (4%) and Washington DC (2.1%).