by Maria Heater | bloomberg
US home prices rose the most on record in the second quarter as buyers battle for a lack of listings.
The average price of a current single-family home jumped 23% from a year ago to an all-time high of $357,900, the National Association of Realtors said in a report Thursday. Of the 183 metropolitan areas measured, about 94% had double-digit gains, up from 89% in the first quarter.
Low mortgage rates have stalled the hot US housing market for more than a year, with inventory shortages driving prices ever higher. Buyers are having a hard time finding properties they can afford: Sales of previously owned homes in the US fell for the fourth straight month in May.
“The growth in home prices over the past year along with the accumulation of housing assets has been spectacular, but is unlikely to repeat in 2022,” Lawrence Yun, chief economist at Realtors Group, said in the report. “There are signs of more supply reaching the market and some moderation in demand.”
The North-East region took the lead with a growth of 22%. Among metro areas, values increased the most in the western Massachusetts city of Pittsfield, about 40 miles from Albany, New York. The average price was $321,900, up 47% from a year ago. It was one of 12 regions nationwide with an increase of over 30%.
The only metro area to decline was Springfield, Illinois, where prices fell 7%.
Price hikes have hit particularly hard for renters looking to become homeowners. According to the report, among first-time buyers, monthly mortgage payments for loans below 10% rose to 25% of income in the second quarter, up from 21% a year ago.
“Housing affordability for first-time buyers is weakening,” Yoon said. “Unfortunately, the benefits of historically low interest rates are overwhelmed by the very rapid rise in home prices.”
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