Southern California home prices continue to defy gravity

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Home price values ​​accelerated across the country in April, according to the most recent data from the S&P CoreLogic Case-Schiller Home Price Indexes. The rise was particularly strong in the western United States

Using January 2020 as a starting point, house prices increased by more than 25% in both San Diego and Seattle during the 16 month period ending April 30.

During this period, home values ​​rose 27.8% in Seattle and 25.9% in San Diego.

San Diego had the advantage of having more potential buyers looking to move to the suburbs, and Phoenix benefited from people moving in from California and colder parts of the Midwest and Northeast. About 260,000 people left California last year, according to data recently presented by economists at Chapman University.

Home prices rose 22.1% in Phoenix in the 16 months from January 2020 to April 2021, and 19% in San Francisco and 17.4% in Los Angeles.

“April’s performance was truly extraordinary,” said Craig J. Lazzara, managing director and global head of index investing strategy at S&P DJI. “The 14.6% gain in the National Composite is literally the highest reading in more than 30 years of S&P CoreLogic Case-Shiller data. Housing prices in all 20 cities have increased; price increases in all 20 cities accelerated.

Analyzing possible reasons for the price spike, he said: “We have previously suggested that the strength of the US housing market is partly due to the response to the COVID pandemic, as potential buyers shift from city apartments to homes. suburban.

“April data continues to be consistent with this hypothesis. This surge in demand may simply represent an acceleration in buying that would have happened anyway over the next few years. Alternatively, there may have been a secular shift in location preferences, resulting in a permanent shift in the housing demand curve. More time and data will be needed to analyze this question.

The Schiller S&P CoreLogic enclosure immovable the data is some of the best data available for home prices. It uses price data from actual transactions and compares those transactions to the last sale.

S&P’s main line of business is credit analysis, but it is well known for its indexes, including the S&P 500 stock market index. CoreLogic, among others, provides real estate data services. And Robert Schiller won his Nobel Prize in Economics for his work suggesting the best way to analyze the markets, which methods are used by the S&P CoreLogic Case-Schiller house price indices.

Tim Shaler is a professional investor and economist based in Southern California. He is a regular columnist for The Epoch Times, where he exclusively provides some of his original economic analysis.

The opinions expressed in this article are the opinions of the author and do not necessarily reflect the opinions of The Epoch Times.

Tim Shaler

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Tim Shaler is a professional investor and economist based in Southern California. He is a regular columnist for The Epoch Times, where he exclusively provides some of his original economic analysis.

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