Led by big gains in Western states, national home prices were 12.1%
higher in April than the year prior, according to a leading home price index,
underscoring how low supply and strong demand have become powerful boosts for
the nation's housing market.
The year-over-year increase in the CoreLogic home price index was the biggest increase in seven years and the 14th consecutive monthly increases in home prices nationally. Prices were up 3.2% from the prior month.
Driven by low inventory, a strong investor presence and record-low mortgage interest rates, housing has taken off this year after hitting a bottom early in 2012. The sharp recovery in prices bodes well for the construction industry, as well as the larger economy.
"House price growth continues to surprise to the upside with an impressive 12.1% gain year over year in April," CoreLogic chief economist Mark Fleming said in news release. "Increasing demand for new and existing homes, coupled with low inventory, has created a virtuous cycle for price gains, most clearly seen in the Western states with year-over-year gains of 20% or more."
The Los Angeles area led gains in prices in April, with the metro area up 19.2% when compared with April 2012. Prices in the region were up 3.5% from the prior month. The states with the biggest home price appreciation were Nevada, up 24.5%; California, up 19.4%; Arizona, up 17.3%; Hawaii, up 17%; and Oregon, up 15.5%.
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