Thought we’d never reach the heights of last decade’s frothy housing boom? Think again. In the first few months of 2018, U.S. home prices jumped more than in any first quarter since 2006.
Single-family home prices rose 6.9 percent from the first quarter of 2017, according to data released Thursday by the Federal Housing Finance Agency. That’s the most for the start of a year since 2006 — when the gain was over 9.1 percent — and the highest for any quarter since 2013.
Six years into the housing recovery, prices are still climbing, largely thanks to an inventory shortage.
At the same time, demand is rising along with confidence in the economy, pushing buyers into bidding wars across the country.
Expect supplies to stay tight: Builders haven’t increased production enough since last decade’s property crash and more seniors are choosing to remain in their houses rather than downsize.
Purchases are also getting more expensive, with mortgage rates that are at a seven-year high and rising. The average rate for a 30-year fixed mortgage rose to 4.66 percent this week — the 15th increase so far this year, Freddie Mac said in a statement Thursday.
At least strict lending standards will keep prices in check, right? Maybe.
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