September 2017 CoreLogic Home Prices Reveal Nearly Half Of The Nation's Largest 50 Markets Are Overvalued

CoreLogic’s Home Price Index (HPI) shows that home prices in the USA are up 7.0 % year-over-year (reported up 0.9 % month-over-month). CoreLogic HPI is used in the Federal Reserves’ Flow of Funds to calculate the values of residential real estate.

Analyst Opinion of CoreLogic’s HPI

CoreLogic year-over-year rate of growth has been steady for three years – with a higher number issued initially and later downwardly revised in the following months. This month they included the following table which speaks for itself:

Home Price Change and Market Conditions for Select Metropolitan Areas

Select Metropolitan Areas September 2017 12-Month
HPI Change
Year Over Year
Single-Family Market
Condition
as of
September 2017 Las Vegas-Henderson-Paradise NV 9.7% Overvalued Denver-Aurora-Lakewood CO 8.4% Overvalued Los Angeles-Long Beach-Glendale CA 7.1% Overvalued Boston MA 7.0% At value San Francisco-Redwood City-South San Francisco CA 6.4% At value Miami-Miami Beach-Kendall FL 5.5% Overvalued Washington-Arlington-Alexandria DC-VA-MD-WV 4.6% Overvalued New York-Jersey City-White Plains NY-NJ 4.5% Overvalued Chicago-Naperville-Arlington Heights IL 4.0% At value Houston-The Woodlands-Sugar Land TX 3.3% Overvalued

Source: CoreLogic September 2017

Dr. Frank Nothaft, chief economist for CoreLogic stated:

Heading into the fall, home price growth continues to grow at a brisk pace. 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.

Frank Martell, president, and CEO of CoreLogic stated:

A strengthening economy, healthy consumer balance sheets and low mortgage interest rates are supporting the continued strong demand for residential real estate. While demand and home price growth is in a sweet spot, a third of metropolitan markets are overvalued and this will become more of an issue if prices continue to rise next year as we anticipate.