Home Prices Rise in August, Expected to Increase Year-to-Year

Home prices rose 3.6% year-to-year in August, and saw an increase of 0.4% from July 2019.

According to CoreLogic’s Home Price Index report for August, home prices are expected to jump 5.8% year-to-year for August 2020 and September’s report should see a 0.3% increase month-to-month. Pennsylvania continues to be in the middle for anticipated rises, falling in line with national predictions.

“The 3.6% increase in annual home price growth this August marked a big slowdown from a year earlier when the U.S. index was up 5.5%. While the slowdown in appreciation occurred across the country at all price points, it was most pronounced at the lower end of the market. Prices for the lowest-priced homes increased by 5.5%, compared with August 2018, when prices increased by 8.4%. This moderation in home-price growth should be welcome news to entry-level buyers,” said Dr. Frank Nothaft, chief economist for CoreLogic.

Across the country, the majority of major metropolitan areas continue to be undervalued or at value, with only 37% of major metropolitan metros considered overvalued, or a market in which home prices are at least 10% higher than a sustainable level.

The report also analyzed homebuying opinions from millennials, finding that 75% of millennial homebuyers plan to buy a home. The suburbs are calling to older millennials, those aged 30-38, who are most likely looking for a stand-alone home with some privacy, while younger millennials, whose aged 21-29, prefer an apartment rental in an urban, lively area.

“The millennial cohort has now entered the housing market in force and is already driving major changes in buying and selling patterns. Almost half of the millennials over 30 years old have bought a house in the last three years. These folks are increasingly looking to move out of urban centers in favor of the suburbs, which offers more privacy and a greener environment. Perhaps most significantly, almost 80% of all millennials are confident they will become homeowners in the future,” said President and CEO of CoreLogic Frank Martell.