U.S. home purchases continue to rise while home purchase price surges to 18.4%

United States home prices surged again in the month of October as the housing market continues to boom in the wake of the COVID-19 pandemic.

According to the S&P CoreLogic Case-Shiller 20-city home price index that came out this week home prices climbed 18.4% in the month of October from the year prior. The percentage did make a small decrease from the September report that was at 19.1% . The continual increase was expected from economists and is right in line with what they were predicting.

All 20 cities that were examined in the study posted double digit annual gains. The hottest markets were Phoenix up 32.3%, Tampa 28.1% and Miami 25.7%. Minneapolis and Chicago posted the smallest increases, 11.5% each.

The housing market has continued to stay strong due to the all time low interest rates on mortgages and the overall supply of the housing market. Another contributing factor is the pent up demand of people wanting to buy from being cooped up in isolation. From many Americans being isolated during the pandemic it has caused many Americans to want to move to the suburban areas of the country.

Experts say the data doesn’t support the theory yet if these numbers are here to stay or if it is temporary. Experts have been saying for a while more data is still needed before they can make a clear prediction whether the high numbers are here to stay.

Mortgage rates last week fell to 3.05% on average for a benchmark 30 year fixed mortgage. For a fixed 15 year mortgage the interest rate landed at about 2.66%. Experts say these interest rates signal a concern over the Omicron variant and the uncertain economic state of the United States.

The National Association of Realtors reported last week that sales of previously occupied homes rose for the third straight month in November to a seasonally adjusted annual rate of 6.46 million.

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