The limited supply of homes for sale continues to push home prices higher.

National single-family home prices increased 7.1% year-over-year in May and 1.1% compared to April, according to the latest edition of CoreLogic's home price index.

Housing inventory shortage

Prices were also up in all 50 states. Washington, Nevada, Idaho and Utah were the biggest gainers, while Connecticut, West Virginia, Vermont and Wyoming had the smallest gains.

"The lean supply of homes for sale is leading to higher sales prices and fewer days on market, and the supply shortage is more acute for entry-level homes," said CoreLogic Chief Economist Frank Nothaft.

About 40% of the 100 largest metropolitan areas based on housing stock are considered overvalued, CoreLogic said, relatively unchanged from a month ago.

What's more, the housing market's inventory woes are expected to continue, according to a consumer survey earlier this year. About 15% of homeowners and 28% of renters stated their desire to buy a home in the next 12 months, while only 11% of homeowners indicated a desire to sell, according to a study conducted by CoreLogic and RTi Research.

The disparity is what's keeping inventory tight, and may partially be explained by the recent rise in mortgage rates.

"During the first quarter, we found that about 50% of all existing homeowners had a mortgage rate of 3.75% or less. May's mortgage rates averaged a seven-year high of 4.6%, with an increasing number of homeowners keeping the low-rate loans they currently have, rather than sell and buy another home that would carry a higher interest rate," said Nothaft.

Looking ahead, consumers should anticipate more of the same. June is expected to see a steady month-over-month single-family home price increase of 0.3% and May 2019 projects a healthy year-over-year growth of 5.1%, according to CoreLogic HPI Forecast.

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