Housing market on winning streak over the past five years
The housing market has been on a winning streak over the past five years, according to the February 2018 Housing News Report published by ATTOM Data Solutions.
Persistent home price appreciation pressures, however, will test the housing market orthodoxies in 2018. In 2017, more than 6 million buyers stepped up and bought a home, the most since 2006.
There’s now a tug-of-war in the real estate marketplace, which suggests that 2018 will be a year of transition, and that many of the old assumptions will be tested. One of those assumptions for investors coming into 2018 will be which housing markets will be home price appreciation winners, following strong appreciation in 2017 (the complete list of last year’s appreciation figures, sorted by metro, can be found here).
U.S. home sellers in fourth quarter 2017 realized an average home price gain since purchase of $54,000, up from $53,732 in the previous quarter and up from $47,133 in fourth quarter 2016, achieving the highest gain in more than 10 years, according to the report.
“It’s the most profitable time to sell a home in more than 10 years, yet homeowners are staying put longer than we’ve ever seen,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “While home sellers on the West Coast are realizing the biggest profits, rapid home price appreciation in red state markets is rivaling that of the high-flying coastal markets and producing sizable profits for home sellers in those middle American markets as well.”
In December 2017, Seattle led the way in recording the highest increase among the national home prices in the United States, with a 12.7 percent year-over-year price increase, followed by Las Vegas with an 11.1 percent increase, and San Francisco with a 9.2 percent increase, according to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index.
“The biggest story for the greater Seattle housing market in 2017 was persistently low inventory levels, which continued to push home prices higher,” said Matthew Gardner, chief economist at Windermere Real Estate.
In addition, the migration of talent and jobs from high-cost housing markets to more reasonably priced housing markets is resulting in accelerating home price appreciation in those reasonably priced markets, many of which historically have posted slow-and-steady appreciation, according to ATTOM. Places such as Kansas City, Nashville, Dallas and Denver are being transformed by this trend, reports ATTOM.
ATTOM’s full housing report can be found here.