Home prices around the country continue to grow in September, jumping 7 percent from the same time last year, according to a new report from CoreLogic.
Prices around the country show no signs of slowing down, with the CoreLogic Home Price Index Forecast predicting that they’ll grow 4.7 by September 2018.
The Miami metropolitan area is no different — in fact, its market is now considered overvalued, according to the CoreLogic Home Price Index. Prices there in September 2017 increased 5.5 percent from the same time last year. Overall, Florida single-family home prices increased 6.2 percent in that time.
In fact, CoreLogic found that 36 percent of the 100 largest U.S. housing markets measured were overvalued as of September 2017.
“A strengthening economy, healthy consumer balance sheets and low mortgage interest rates are supporting the continued strong demand for residential real estate,” said Frank Martell, president and CEO of CoreLogic. “While demand and home price growth is in a sweet spot, a third of metropolitan markets are overvalued and this will become more of an issue if prices continue to rise next year as we anticipate.”
A recent report from the Urban Institute credits the high number of cities at risk for a bubble to four factors, the first of which is lack of building that constrains supplies. The organization also found that a number of MSAs overcompensated for effects of the economic downturn: Cities that had slow price growth in previous bubbles saw the largest drops in the downturns.
Many cities that are at risk of a bubble have large shares of international investors snatching up homes and driving up prices. Also, new nontraditional investors in some cities are buying houses to rent out, thereby increasing both purchase and rental prices.