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US home prices grew by 5% fueled by falling mortgage rates and limited supply
Posted on January 15, 2024 |
Home prices in the US are on the rise, with a 5.2% year-on-year increase in November, up from the previous month's 4.7% gain.
Forecasts suggest a further 2.5% increase in home prices over the next 12 months, despite concerns about a potential economic growth slowdown in 2024.
The average 30-year fixed-rate mortgage has dropped from 7.9% in late October to 6.6% as of January 4, boosting demand and contributing to the surge in house prices.
A significant factor in driving up prices is the persistently low inventory levels, with the US facing a shortage ranging from 1.5 million to 5.5 million homes.
The combination of falling mortgage rates and limited housing supply collectively contributes to the robust and ongoing increase in US home prices.