U.S. home prices grew in the first six months at an annualized rate of 6.3 percent while new home construction bounced back in June from a five-year low, data from the latest studies say.
U.S. Home Prices Resilient During the First Half of 2020
According to the data released by Red Bell Real Estate, LLC, the Radian Home Price Index (HPI) was also up 8.1 percent from July 2019 to June 2020 and slightly higher than the 7.8 percent increase last May 2020. The spike, the report said, suggests that the general upward trend in annualized yearly growth has resumed.
Steve Gaenzler, SVP of Data and Analytics, said that home prices, in general, have remained resilient despite localized volatility in prices brought by the pandemic. After slowing down in May, the first half of 2020 closed quite impressively despite the significant headwinds faced by real estate transactions.
In June, the single-family and condominium homes' median estimated price across the nation rose to $256,740 from $254,826 in May. Home prices grew 6.6 percent in Q2 of 2020. Distressed sales account for 5.1 percent of all sales in June 2020 with REO represent 4.4 percent of the distressed sales. That distressed sales figure is a decline from May's 6.0 percent with REO sales representing 5.2 percent of distressed sales.
While New Hampshire and Maine recorded strong home price growth, the Northeast region had the slowest rate of appreciation. In the South, Louisiana home prices remained flat while Tennessee and Georgia had the strongest rate of appreciation; Florida had the weakest performing price appreciation.
Washington and Utah are the best performing locations in the West as the region ranked second in the best-performing areas in the U.S. following the Midwest region. Missouri, Minnesota, and Indiana led price appreciation in the Midwest.
All of the 20 largest U.S. metro areas posted positive gains in Q2 and the second half of 2020. The strongest metros included Phoenix, Seattle, and Minneapolis; all had more than seven percent annualized home appreciation in the first six months of the year. The weakest large metros include Baltimore (up 3 percent), and Washington, D.C., Boston and Miami (each up 3.3 percent)
Read also: Home Price Growth Predicted to Stall and Remain Throughout the Summer
New Home Construction Jumps 17.3%
Meanwhile, new home construction bounced back in June from a five-year low recorded last April, the U.S Census Bureau report said. Privately-owned housing starts rose 17.3 percent from May to 1.19 million units seasonally adjusted rate. Housing starts declined four percent from the June 2019 rate despite the pandemic while single-family starts rose 17.2 percent month-over-month to a rate of 831,000.
Privately-owned housing units authorized by building permits rose 2.1 percent from May to a seasonally adjusted annual rate of 1,241,000 units. However, the figure is 2.5 percent lower than the 1,273,000 units rate from the same period last year. Single-family authorizations, on the other hand, were up 11.8 percent from May at a rate of 834,000 units.
As for housing completions in June, privately-owned housing rose 4.3 percent from last month to a seasonally adjusted rate of 1,174,000 and 5.1 percent higher than the June 2019 rate of 1,166,000. Single-family housing completions were up 9.6 percent from last month's rate of 830,000.
