Home prices nationwide rose 15.4 percent in May, the largest year-over-year increase since November 2005, according to data released today.
Not enough houses being built combined with a demand for more homes continued to drive up prices during the fifth month of the year, causing many prospective buyers – especially first-time and low-income buyers – to stay out of the market, Irvine-based CoreLogic reported.
“First-time buyers are hitting a wall in many places around the country as the pace of home prices rising outpace the benefits of lower borrowing costs,” said Frank Martell, CoreLogic’s president and chief executive officer, in the statement.
“Younger and first-time buyers, including younger millennials, are faced with the challenge of having sufficient savings for a down payment, closing costs and cash reserves.”
Single-family home prices are expected to keep rising during the second half of 2021, possibly pushing more would be buyers out of the market. If that happens it could slow price growth during the next year or two, Martin predicted.
In the Inland Empire, home prices grew 19.7 percent between May of this year and May 2020, according to CoreLogic.