Compared to last year, home prices in the Chicago-Naperville-Arlington Heights MSA rose 4 percent in September 2017, but the market remained unchanged between August and September, despite home prices becoming overvalued in many cities nationwide.
According to CoreLogic’s U.S. Home Price Index, as of September 2017, half of the nation’s 50 largest housing markets are currently overvalued on year-by-year and month-by-month basis. Overvalued housing by HPI’s standards represents home prices that are “at least 10 percent higher than the long-term, sustainable level.”
Since September 2016, home prices nationwide have increased 7 percent and are expected to increase over the course of 2018.
“Heading into the fall, home price growth continues to grow at a brisk pace,” said Dr. Frank Nothaft, CoreLogic’s chief economist. “This appreciation reflects the low for-sale inventory that is holding back sales and pushing up prices. The CoreLogic Single-Family Rent Index rose about 3 percent over the last year, less than half the rise in the national Home Price Index.”
Out of 100 of the country’s largest metropolitan cities, 36 percent, including Chicago, now have overvalued housing stock, while 28 percent of housing was undervalued. On the whole, Chicago’s housing market remains at value.