Q1 Report: Home prices increase by double digits in nearly every metro market
Home prices are rising—everywhere. That’s the takeaway from the latest quarterly report released by the National Association of Realtors.® In the first quarter of 2021, nearly every metro area tracked by the NAR— 99% — recorded year-over-year price increases.
"Significant price increases throughout the country simply illustrate strong demand and record-low housing supply," said Lawrence Yun, NAR chief economist.
"The record-high home prices are happening across nearly all markets, big and small, even in those metros that have long been considered off-the-radar in prior years for many home seekers."
Rising prices, across the map
If you were trying to escape rising prices in the first quarter of 2021, there weren’t many places to turn to. An overwhelming majority of metro areas (89%) saw double-digit price increases, compared to just 25% of metro areas during the first quarter of 2020.
And while upwardly surging prices are welcome news for sellers, many buyers are facing challenges finding a home they can afford. "The sudden price appreciation is impacting affordability, especially among first-time home buyers," said Yun. "With low inventory already impacting the market, added skyrocketing costs have left many families facing the reality of being priced out entirely."
The country’s most expensive markets
As might be expected, most expensive local housing markets in the country saw double-digit price growth, with increases of over 20% not uncommon.
- San Jose-Sunnyvale-Santa Clara, Calif. ($1.5 million; 11.1%)
- San Francisco-Oakland-Hayward, Calif. ($1.2 million; 21.8%)
- Anaheim-Santa Ana-Irvine, Calif. ($1.0 million; 14.3%)
- Urban Honolulu, Hawaii ($940,400; 19.2%)
- San Diego-Carlsbad, Calif. ($763,500; 14.0%)
- Boulder, Colo.($726,600; 16.7%)
- Los Angeles-Long Beach-Glendale, Calif. ($682,400; 15.1%)
- Seattle-Tacoma-Bellevue, Wash. ($653,400; 17.9%)
- Naples-Immokalee-Marco Island, Fla. ($599,500; 24.9%)
- Nassau County-Suffolk County, N.Y. ($598,600; 22.7%)
Rising prices means rising mortgage payments
The steady climb in housing prices is also translating to higher housing costs for homeowners. The average national monthly mortgage payment rose to $1,067, up from $995 one year ago. It’s worth noting that this increase took place though the effective 30-year fixed mortgage rate decreased to 2.93% in the first quarter of 2021 (from 3.57% one year ago).
Nationally, a family typically needed an income of $51,216 to pay a 30-year fixed-rate mortgage with a 20% down payment, while that same family needed an income of $47,760 one year ago).