CoreLogic Home Price Index Report noted an increase of 5.4% in the national home prices in May. In April, the noted increases were set at 3.6% in April 2019. According to CoreLogic, the price increase in the housing market is taking place due to the low inventory in the housing market. Furthermore, the current economic situation and relevant metrics are indicating a potential dip in oppose to the rising prices. Will the market recover from the Coronavirus effects and will home prices continue to surge?
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Tight Supply in Housing and the Rising Demand
Frank Nothaft, chief economist at CoreLogic considers that the housing market is likely to bounce back when it comes to purchasing activity and prices of homes in the medium turn. Judging by the rising demand noted among millennials in combination with tight supply in the market injects a dose of positivity in terms of waiting for a bounce-back in the market.
Bank of America and CoreLogic Shares Opinion on the Housing Market
Bank of America released a similar report to the one released by CoreLogic. Furthermore, the prediction indicates that the virus-induces economic fallout should bring numerous reversals across different markets. More data shows that the prices are less likely to continue to rise in the long run, while dips are expected with newly listed homes that are trading at lower prices when compared to the pre-COVID-19 listings.
The Overall State of the Housing Market in June 2020
To jump in instead of usually the busiest period in the housing market, June appears to be announcing increased purchase activity in the upcoming summer. With new homes being listed in the housing market, the prices are more likely to dip, which should result in increased purchase activity.
