Prices of US homes climb 18.4% in October

WASHINGTON — U.S. home prices surged again in October as the housing market continues to boom in the wake of last year’s coronavirus recession.

The S&P CoreLogic Case-Shiller 20-city home price index, out Tuesday, climbed 18.4% in October from a year earlier. The gain marked a slight deceleration from a 19.1% year-over-year increase in September but was about in line with what economists had been expecting.

All 20 cities posted double-digit annual gains. The hottest markets were Phoenix (up 32.3%), Tampa (28.1%) and Miami (25.7%). Minneapolis and Chicago posted the smallest increases, 11.5% each.

The housing market has been strong thanks to rock-bottom mortgage rates, a limited supply of homes on the market and pent-up demand from consumers locked in last year by the pandemic. Many Americans, tired of being cooped up during the pandemic, are looking to trade up from apartments to homes or to bigger houses.

“Home price growth will slow further in the year ahead, but continue to go up,” said Danielle Hale, chief economist at Realtor. com.

Last week, mortgage rates fell — to 3.05% for the benchmark 30-year, fixed-rate and 2.66% for the 15-year fixed-rate home loan. The persistently low rates signal that credit markets appear more concerned about the omicron variant depressing economic growth than about the highest inflation rates in nearly 40 years.

The National Association of Realtors recently reported that sales of previously occupied homes rose for the third straight month in November to a seasonally adjusted annual rate of 6.46 million.