June 06, 2019
Two Cities in our Service Area Continue to See Highest-in-Nation Price Acceleration
Changes in the prices of homes have been the subject of much speculation of late, as we have seen the meteoric growth in sales prices diminish. That’s the growth—not the actual prices, which continue to rise, just at a slower pace. But even in a field of slowing price acceleration, there will be some markets where the acceleration slows more quickly and some where the acceleration has a bit more momentum to its roll.
CoreLogic’s HPI Forecast Validation Report, which “compares the 12 months CoreLogic Home Price Index (HPI) forecast to the actual CoreLogic HPI data and compares the changes in national and key core-based statistical areas (CBSA)-level forecasts”, validates performance results. This particular report used this method of comparing the increase in HPI forecast to the increase that has in fact occurred in their HPI index over a single-year period to determine the rates as of the end of November 2018. While the company’s national index forecasted a year-over-year change of 4.7 percent, the true index value came to 4.8 percent. Volatile housing conditions likely account for the slight discrepancy.
The tabulation method for determining HPI utilizes public records, securities databases, and servicing databases covering 40 years of transactions, and takes account of previous trends. In order to make their forecasts, CoreLogic incorporates the historic HPI and what they call the “equilibrium home price—as a function of real disposable income per capita,” which they compare against “short-run fluctuations caused by market momentum, mean-reversion, and exogenous economic shocks,” such as fluctuations in the rate of employment.
By these rubrics, among the cities with the highest valuations in the nation, Miami, Florida—which is in our service area; Austin-Round Rock, Texas; and Cape-Coral-Fort Meyers, Florida—also in our service area—were the top three in the nation for price acceleration during this period.
If you are looking to buy a home, give us a call. At Topouzis & Associates, P.C. we utilize our considerable expertise ensure our clients are conveying and purchasing property title clear of judgments and defects. We also help our clients put into place a good policy of title insurance to make certain they don’t get surprised by any nasty lurking issues with a property. Contact us if you’d like us to do this for you.