U.S. Non-Coastal States See Faster Pace of Home Price Growth

(Bloomberg) -- Home prices increased nationally by 3.6% from May 2018, according to data from CoreLogic. By state, annual home price growth varied from a 1.7% decline in North Dakota to a 10.7% increase in Idaho.

“Interest rates on fixed-rate mortgages fell by nearly one percentage point between November 2018 and this May,” said Dr. Frank Nothaft, chief economist at CoreLogic. “This has been a shot-in-the-arm for home sales. Sales gained momentum in May and annual home-price growth accelerated for the first time since March 2018.”

While national prices showed moderate acceleration in May, Idaho is the only state to post a double-digit gain for the month. It has seen double-digit growth every month except for one since November 2017.

The pre-crisis peak in Idaho was July 2007. Prices then fell by 38.2% through Feb. 2011. Since then prices have completely made up these losses and are now up nearly 25% from the previous peak.

The states with the largest year-over-year gains in home prices in May are not on the coasts. Among the top 15 states, only Maine and New Hampshire have coastlines. Midwestern states such as Wisconsin, Michigan and Ohio -- viewed as possible keys in the 2020 election -- remain above the national average of 3.6%.

CoreLogic expects that prices will rise by 5.6% nationally over the next year.

To contact the reporter on this story: Alex Tanzi in Washington at atanzi@bloomberg.net

To contact the editors responsible for this story: Alex Tanzi at atanzi@bloomberg.net, Chris Middleton

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