Home prices increased significantly in the first half of 2021 due to low supply over the past year, especially in the Southern or Western U.S., according to new data from Credible. In fact, May saw a record-breaking price gains – 16.6% – according to the S&P CoreLogic Case-Shiller Home Price Index.
The coronavirus pandemic unequivocally changed the dynamics of homebuying across many cities. People have opted to spend more time in their homes, work remotely and appear less eager to live in downtown areas or employment hotspots due to a lack of a commute. In turn, home prices have been appreciating in non traditional-areas, and these dynamics may not change for the foreseeable future.
"More individuals appear to be favoring lower-cost areas over higher-priced employment hubs," the Credible study states. "This is especially true in California. Of the six California metro areas on the list, all are located in either the state’s Central Valley or Inland Empire."
As home prices grow across the U.S. amid high competition and low inventory, homeowners can take advantage of the newfound equity in their home through a mortgage refinance. Use Credible's free online tool to research different mortgage refinance lenders and see what your loan options are.
Cities with highest price surge
Some of the highest home price increases have been seen in America's South and West, Credible’s study shows. Most price increases haven't come from transitional areas like San Diego, San Jose, San Francisco, Seattle or similar cities that typically see the highest gains.
"Looking at the markets experiencing the highest price growth, we have seen large migration to states with no income tax, including Florida, Washington, Nevada and Texas," said Chris Stroud, HouseCanary co-founder and chief of research.
Here's a look at the top 10 cities with the highest percentage change in median home price increases from December 2020 to June 2021:
- Boise, Idaho (12.99%)
- Provo-Orem, Utah (12.22%)
- Ocala, Florida (12.1%)
- Modesto, California (10.92%)
- Cape Coral-Fort Myers, Florida (10.31%)
- Atlantic City-Hammonton, New Jersey (9.51%)
- Stockton, California (9.47%)
- Phoenix-Mesa-Chandler, Arizona (9.43%)
- Visalia, California (9.21%)
- Deltona-Daytona Beach-Ormond Beach, Florida (9.07%)
If you live in one of these cities seeing the highest increases in home prices, you could benefit from a cash-out refinance. You can explore your mortgage refinance options in minutes by visiting Credible to compare rates and lenders. Check out Credible and get prequalified today.
How can homeowners and homebuyers take advantage of increases?
With home prices on the rise, especially in the Southern and Western U.S. housing markets, homeowners can benefit from the new equity in their home. Buyers must also pay attention to rising costs; here are a few ways both groups can take advantage:
Homebuyers: A difficult market lies ahead of homebuyers, as prices continue to rise and competition remains fierce. However, they can utilize Credible's list to avoid buying from sellers in areas with highest levels of increases. Low interest rates also put buyers at an advantage, since they're more likely to be able to afford higher prices with the money they save. Visit Credible to compare multiple mortgage lenders at once to ensure you are getting low mortgage rates.
Homeowners: Over the last year, homeowners have seen the most benefit from rising home prices in today’s real estate market. Higher levels of equity allow homeowners to pull a cash-out refinance out of their home.
The higher equity levels have also enabled many homeowners to remove their primary mortgage insurance (PMI) from their monthly payment. For homeowners with Federal Housing Administration (FHA)-backed loans, the only way to remove the PMI is through a refinance. Contact Credible to get started on your mortgage refinance and save up to hundreds of dollars on your monthly mortgage payment.
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