Home Price Escalation and Rising Mortgage Rate: Buying a Home Becomes Less Affordable

The latest S&P CoreLogic Case-Shiller Home Price Index report, released February 22, included data for December, closing out the year for 2021. The results were remarkable, with home price gains for the year at 18.8% nationwide, the highest in the 34-year reporting history, and at 18.6% for the 20-City Composite report, also a record high. Phoenix saw the greatest gains at 32.5% price increases, a lead they have held for 31 months. Analysis suggests that Covid-related relocations have impacted purchases that would have perhaps been made over the next several years. The report expects to see slowing of the price escalation soon due to “the impact of increasing mortgage rates on home prices.”

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