U.S. home prices soared by the most on record in April as the COVID-19 pandemic accelerated the flight out of city centers and into the suburbs.
Home prices rose 14.6% year over year nationally in April, according to the national Case-Shiller index, making for the highest reading in more than 30 years of recordkeeping.
Prices are now 34.9% above their 2006 peak.
"April’s performance was truly extraordinary," said Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices.
The 20-city composite increased 14.9% from a year ago, up from a 12.9% gain the previous month. All 20 cities reported price increases versus last year with Phoenix (+22.3%), San Diego (+21.6%) and Seattle (+20.2%) continuing to see the biggest gains. Chicago (+9.9%) had the smallest increase.
Charlotte, Cleveland, Dallas, Denver and Seattle all recorded their biggest annual price gains on record.
Prospective homebuyers waiting for prices to cool could be on the sidelines for quite some time, according to Selma Hepp, deputy chief economist at CoreLogic.
"Mortgage interest rates remain 50% lower than they were in 2005, when home price growth last peaked, keeping the ratio of mortgage payments to monthly households income lower today," she said. "It's probably that continued massive demand will keep pressure on prices, which are likely to remain at double-digit growth rate throughout the remainder of 2021."