According to the Case-Shiller Home Price Index, home prices in the 20 largest U.S. cities increased 14.88 percent year-over-year in April, the highest level since November 2005.
Among them, Phoenix, San Diego and Seattle had the highest annual home price growth rates among the 20 cities.
Across the U.S., the situation was worse. the Case-Shiller National Home Price Index rose 14.59% year-over-year in April, the fastest rate of home price growth since records began in 1988, surpassing the peak acceleration in September 2005.
As previously mentioned by Wall Street News, Boston Fed President Eric Rosengren warned that large swings in the housing market could affect the “sustainability” of the 2% inflation target and threaten the stability of financial markets.
In order to make the inflation target sustainable, the U.S. can’t go through such a “big up and down” boom-bust cycle in areas like real estate.
But home prices in all U.S. cities are rising at a double-digit percentage rate, well above the Federal Reserve’s target.
Craig Lazzara, managing director and head of index investment strategy at S&P Dow Jones Indices, said.
We have previously indicated that the strength in the U.S. housing market was driven in part by the new crown epidemic, with some buyers switching from urban apartments to suburban homes.
April’s numbers remain consistent with this. This surge in demand may simply be a necessary trend.
Another possibility is that there has been a long-term change in siting preferences, resulting in a permanent shift in the housing demand curve as well.