Increases in home prices in the Salt Lake City market continue to outpace those nationally, according to figures released by Irvine, California-based CoreLogic, a property information and analytics service. Local prices were up 9.6 percent in May compared to May 2016. Nationwide, prices showed a 6.6 percent increase for the same period. CoreLogic’s Home Price Index (HPI) and HPI Forecast reports are released monthly when sales figures become available.
On a month-over-month basis, Salt Lake City area prices were up 1.1 percent from April to May while nationally, homes sold for 1.2 percent more for the same period. Prices used in the survey included distressed sales such a foreclosures and short sales.
Looking ahead, the CoreLogic HPI Forecast predicts that home prices will increase by 5.3 percent on a year-over-year basis from May 2017 to May 2018, and on a month-over-month basis home prices are expected to increase by 0.9 percent from May to June. The CoreLogic HPI Forecast is a projection of home prices using the CoreLogic HPI and other economic variables.
“The market remained robust with home sales and prices continuing to increase steadily in May,” said Frank Nothaft, chief economist for CoreLogic. “While the market is consistently generating home price growth, sales activity is being hindered by a lack of inventory across many markets. This tight inventory is also impacting the rental market, where overall single-family rent inflation was 3.1 percent on a year-over-year basis in May of this year compared with May of last year. Rents in the affordable single-family rental segment (defined as properties with rents less than 75 percent of the regional median rent) increased 4.7 percent over the same time, well above the pace of overall inflation.”
“For current homeowners, the strong run-up in prices has boosted home equity and, in some cases, spending,” said Frank Martell, president and CEO of CoreLogic. “For renters and potential first-time homebuyers, it is not such a pretty picture. With price appreciation and rental inflation outstripping income growth, affordability is destined to become a bigger issue in most markets.”
CoreLogic also reported that 3.2 percent of mortgages in the Salt Lake market were in some stage of delinquency (30 days or more past due, including those in foreclosure) in April, which represented a decrease of 0.4 percentage points. The monthly Loan Performance Insights Report showed that nationally, 4.8 percent of mortgages were delinquent. This represents a 0.5 percentage point decline in the overall delinquency rate compared with April 2016 when it was 5.3 percent.