U.S. Home Price Gains Slow in May, Radian Home Price Index Reveals
17 Juin 2020 - 12:30PM
Business Wire
Home prices across the United States rose at an annualized rate
of 4.5 percent in May 2020 from April 2020, according to Radian
Home Price Index (HPI) data released today by Red Bell Real Estate,
LLC, a Radian Group Inc. company (NYSE: RDN). The Radian HPI is the
most comprehensive and timely measure of U.S. housing market prices
and conditions.
The Radian HPI also rose 7.8 percent year-over-year (June 2019
to May 2020), which was slightly lower than the year-over-year
increase of 7.9 percent recorded last month. Slowing home price
growth is not unexpected given the dramatic COVID-19 impact on the
ability to enter into and close many real estate transactions.
The Radian HPI is calculated based on the estimated values of
more than 70 million unique U.S. addresses each month, covering all
single-family property types and geographies.
“Home price gains across the U.S. slowed in May, a month
typically known for accelerating activity, however the month also
recorded additional reversals in some of the recent, negative real
estate transactional data trends,” noted Steve Gaenzler, SVP of
Data and Analytics. “Nationally, the weekly counts of properties
going 'under contract,' a leading indicator to closings and sales,
ended the month with higher levels than in the same period of 2019.
In addition, the Mortgage Bankers Association reported that
applications for new mortgages were accelerating during the month
and that the rate of new forbearance requests had begun to decline
towards the end of the month.”
Gaenzler also added that “softer home price appreciation across
the U.S. compared to the prior month suggests that the full impact
of COVID nationally or locally on home prices may not yet be felt,
but we are encouraged by some of our leading indicators.”
NATIONAL DATA AND TRENDS
- Median home price in the U.S. rose to $254,826
- Home prices rose an annualized 5.5 percent over the last three
months
Nationally, the median estimated price for single-family and
condominium homes rose to $254,826. Across the U.S., home prices
nationally rose 5.5 percent over the last three months, slightly
lower than the 5.6 percent reported for the three months from
February through April. The impact of COVID-19 in May on national
markets appears to have been to slow the rate of appreciation, as
opposed to a decline in prices. Typically, home prices accelerate
their growth momentum into the summer season. At 4.5 percent, the
annualized rate reported in May was softer than recent years, but
remained positive.
REGIONAL DATA AND TRENDS
- Majority of regions softer from prior month
- South and Northeast regions exhibit largest changes
In May, home price appreciation slowed from the prior month in
all regions except the Mid-Atlantic, a region that has, so far,
reported the most negative HPI impacts during COVID-19. The weakest
regions this month were the South and Northeast, while the Midwest
continued to be the best performing region. In a change from
April’s report, all regions reported positive home price growth in
May. Home buyer interest remained robust, while the future supply
of new housing (New Private Housing Units Authorized by Building
Permits as reported by the U.S. Department of Housing and Urban
Development) recorded levels 50 percent lower than January
2020—both providing support for home prices in May.
The Western region recorded an actual 12-month price
appreciation rate (+6.1 percent), a rate higher than its annualized
change from April to May (+5.5 percent), but lower than the 3-month
rate of 6.9 percent. Conversely, the South which recorded a
12-month appreciation rate of 6.8 percent was only able to generate
a 2.5 percent annualized growth rate last month.
METROPOLITAN AREA DATA AND TRENDS
- New York metro area prices rebound in May
- Slower, but positive, appreciation the norm in most metros
Across the 20-largest metro areas of the U.S, all of them
recorded positive price appreciation in May, but all were at slower
rates than reported in April. Two metros in particular, Baltimore
and New York recorded higher rates of price growth last month after
a series of months with rates well below longer term growth. And
while rates were softer this month, we note that in 14 of the top
20 largest CBSAs, short term growth rates (3-months) remain higher
than longer term rates (12-months).
The weakest metros in May based on their annualized growth
included Washington, D.C. (+0.0 percent), Los Angeles (+1.9
percent), Baltimore (+2.1 percent) and Miami (+2.1 percent). The
strongest included Minneapolis, Seattle, New York and St. Louis,
all with greater than 6.4 percent growth in May.
ABOUT THE RADIAN HPI
Red Bell, a subsidiary of Radian Group Inc., provides national
and regional indices for download at info.radian.biz/hpi, along
with information on how to access the full library of indices.
Additional content on the housing market can also be found on
the Radian Insights page located at
https://radian.com/news-and-knowledge/insights.
The company offers the Radian HPI data set along with a client
access portal for content visualization and data extraction. The
engine behind the Radian HPI has created more than 100,000 unique
data series, which are updated on a monthly basis.
The Radian HPI Portal is a self-service data and visualization
platform that contains a library of thousands of high-value indices
based on both geographic dimensions as well as by market, or
property attributes. The platform provides monthly updated access
to nine different geographic dimensions, from the national level
down to zip codes. In addition, the Radian HPI provides unique
insights into market changes, conditions and strength across
multiple property attributes, including bedroom count and livable
square footage. To help enhance its customers’ understanding of
granular real estate markets, the library is expanded regularly to
include more insightful indices.
In addition to the services offered by its Red Bell subsidiary,
Radian is ensuring the American dream of homeownership responsibly
and sustainably through products and services that include
industry-leading mortgage insurance and a comprehensive suite of
mortgage, risk, title, valuation, asset management and other real
estate services. The company is powered by technology, informed by
data and driven to deliver new and better ways to transact and
manage risk. Visit www.radian.com to see how Radian is shaping the
future of mortgage and real estate services.
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version on businesswire.com: https://www.businesswire.com/news/home/20200617005207/en/
For Investors John Damian – Phone: 215.231.1383 Email:
john.damian@radian.com
For the Media Rashi Iyer – Phone: 215.231.1167 Email:
rashi.iyer@radian.com
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