Highest Annual Home Price Appreciation Since March 2006, More Expected -CoreLogic
Home prices measured by CoreLogic increased by 10.5 percent on an annual basis in March, the largest year-over-year increase since March 2006. The company's HPI Report said March marked the 13th consecutive month that its home price index that includes distressed sales increased compared to the same month a year earlier. Distressed sales include both bank-owned real estate (REO) and short sale transactions. The index excluding distressed sales was up 10.7 percent compared to March 2012
The HPI including short and REO sales increased 1.9 percent from February to March. With distressed sales excluded the month-over-month increase was 2.4 percent.
"For the first time since March 2006, both the overall index and the index that excludes distressed sales are above 10 percent year over year," said Dr. Mark Fleming, chief economist for CoreLogic. "The pace of appreciation has been accelerating throughout 2012 and so far in 2013 leading into the home buying season."
CoreLogic expects the strong upward trend to continue. Its Pending HPI including distressed sales projects an increase of 9.6 percent from April 2012 to April 2013 and excluding distressed sales a 12 percent annual increase. On a monthly basis CoreLogic is looking for a 1.3 percent bump in its index with distressed sales and a 2.7 percent increase in the index without them. The Pending HPI is based on Multiple Listing Service (MLS) data that measure price changes for the most recent month.
"Home prices continue to rise at a double-digit rate in March led by strong gains in the western region of the U.S. Looking ahead, the CoreLogic pending index for April indicates that upward price appreciation will continue," said Anand Nallathambi, president and CEO of CoreLogic. "Much of the price increases we are seeing are the result of rising demand among investors and homebuyers for a still-limited supply of homes for sale."
The states with the largest annual home price appreciation including distressed sales were Nevada (+22.2 percent), California (+17.2 percent), and Arizona (+16.8 percent). Only four states posted any annual home price depreciation: Delaware (-3.7 percent), Alabama (-3.1 percent), Illinois (-1.8 percent) and West Virginia (-0.3 percent).
Excluding distressed sales the greatest appreciation was noted again in Nevada (+20.8 percent) and California (+16.8 percent) with Idaho third at +16.3. No states lost ground on this index in March.
The peak-to-current change in the national HPI (from April 2006 to March 2013) was -25.1 percent including distressed sales and -18.3 percent including them. The states furthest from their peaks are Nevada (-49.2 percent), Florida (-42.8 percent), Michigan (-38.9 percent), Arizona (-37.8 percent) and Rhode Island (-36.2 percent).