WASHINGTON – U.S. home prices rose in January after three months of declines as a tight supply of properties likely supported prices despite slower sales.
Real estate data provider CoreLogic said Tuesday that prices rose 0.9 percent in January after dipping 0.1 percent in December. Over the past 12 months, home prices have risen 12 percent, the biggest year-over-year gain in more than eight years.
Such outsize price gains might not continue much longer, however. Paul Diggle, an economist at Capital Economics, notes that January’s price gains reflect conditions several months ago, when buyers first made offers. The supply of available homes was smaller than it is now, and it helped lift prices. The sales were completed in January.
Since then, more homes have come on the market while sales have slowed. That trend has modestly boosted the supply of homes and “points to a slowdown in price gains later this year,” Diggle said.
Diggle, like most other economists, foresees year-over-year price gains of below 10 percent in the coming months.
The Buffalo Niagara Association of Realtors has not yet released data for January from its members. However, according to CoreLogic, home prices in the Buffalo-Niagara Falls metropolitan area rose by 4.5 percent in January over a year ago, when including distressed sales such as foreclosed properties or short sales.