November, Yet Another Month of Record Home Price Growth

It is increasingly clear that the science, or perhaps it is an art, of home price forecasting could use some work. One year ago, in its report on November 2020 home prices, CoreLogic projected that the 7.5 percent annual appreciation reflected in those numbers would slow to 2.5 percent by November 2021. The results are in , and those November prices were up 18.1 percent year-over-year . Not beating up on CoreLogic. This has been a tough year to anticipate anything in the housing market and others have failed as well. During the National Association of Realtors December 2020 Real Estate Forecast Summit, the consensus of 23 economists was for prices to rise 8.0 percent last year. It was a 10-point miss. A pandemic, supply chain issues, soaring prices for building lots and materials, record low inventories; Nostradamus would be befuddled. Still, one wonders why analysts go so far out with their projections. Props for their courage. The 18.1 percent increase in November is actually a slight acceleration from than annual growth in September and October. CoreLogic put the increase at 18 percent in both months. The month-over-month change in November was 1.3 percent, identical to the September to October number. The company notes that 2021 was a record breaker for home price growth and, “for many prospective buyers the hot housing market will continue to exacerbate ongoing affordability challenges into the new year — and beyond.”