Home prices jumped 7.3% year over year in October, making it the fastest acceleration since April 2014, according to the CoreLogic Home Price Index Report.
The price increase was marginal (1.1%) from September.
The month-over-month percentage change in single-family home prices was up slightly in Chicago by 2.6%, while the year-over-year change was an increase of 5.4%. The forecasted year-over-year increase for 2021 is 1.9%, according to the report.
Home construction continued to surge across the nation, which reflected the projection that new homes will help moderate price growth over the next 12 months.
“Home buyers have been spurred by record-low mortgage rates and an urgency to buy or upgrade to more space, especially as much of the American workforce continues to work from home,” Frank Martell, president and CEO of CoreLogic, said in a press release. “First-time buyers in particular should remain a big part of next year’s home purchases, as the largest wave of millennials is heading into prime home-buying years.”
Although home price growth has accelerated nationwide, local markets have varied, according to the report, which showed that Phoenix experienced a one-month increase of 12.1% in October. At the same time, the New York-Jersey City-White Plains metro area only saw a 2.1% gain.
“The pandemic has shifted home buyer interest toward detached rather than attached homes,” said Dr. Frank Nothaft, chief economist at CoreLogic. “Detached homes offer more living space and are typically located in less densely populated neighborhoods. And while prices of single-family detached homes posted an annual increase of 7.9% in October, the price of attached homes rose only 4.5% year over year.”