Nearly 50% of the largest housing markets are overvalued
Home prices are up 7% year-over-year in September, with nearly half of the nation's largest 50 markets overvalued, according to CoreLogic. Home prices are up 0.9% from August to September.
Home values are projected to increase another 4.7% by September 2018, but decrease by 0.1% from September to October.
"Heading into the fall, home price growth continues to grow at a brisk pace," said Frank Nothaft, chief economist for CoreLogic, in a press release.
"This appreciation reflects the low for-sale inventory that is holding back sales and pushing up prices. The CoreLogic Single-Family Rent Index rose about 3% over the last year, less than half the rise in the national Home Price Index," he continued.
Of the country's top 50 markets based on housing stock, 48% were overvalued in September, with only 16% undervalued. About 36% of the top markets were at value.
"A strengthening economy, healthy consumer balance sheets and low mortgage interest rates are supporting the continued strong demand for residential real estate," said Frank Martell, president and CEO of CoreLogic, in a press release.
"While demand and home price growth is in a sweet spot, a third of metropolitan markets are overvalued and this will become more of an issue if prices continue to rise next year as we anticipate," said Martell.
Of the country's 100 largest metropolitan areas, 36% have an overvalued stock in September, with Las Vegas leading the cities in year-over-year percent change; home prices in Las Vegas are up 9.7% from last year.