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Home prices continued their nationwide climb in March, rising 6.7% from last year, with Western states leading the gains—posting double-digit increases—according to the CoreLogic Home Price Index.
Washington posted the highest year-over-year increase at 13%, followed by Colorado and Oregon at 10% each. Maryland recorded the smallest gain from last year, rising just 0.7%, while Connecticut and Wyoming tied for second-smallest with a 1% increase.
NAR Managing Director of Housing Research Danielle Hale tells Bisnow strong job growth in the West has spurred the higher property prices.
“Since April 2012, the West has led other US regions in the rate of growth of its payroll employment, and its total payroll employment is now more than 5% higher than its pre-recession peak.”
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The West’s strong jobs numbers come as the rest of the nation sees a slight slump in job growth, adding only 160,000 jobs in April, when surveys of top economists projected 200,000-plus jobs added.
The booming tech sector out West certainly helps. In Oregon, for instance, tech employment grew at its fastest rate in a decade last year, and those jobs pay well—twice the statewide average.
Job growth isn’t solely to blame, as Danielle tells us rising rents have also pushed up home prices. In the West, rental vacancy rates are at 5.1%, the lowest levels seen since in the region since the 1980s, she says.
Despite rising prices, the West’s affordability picture hasn’t changed much, she says, as income gains and low mortgage rates have offset costs, keeping affordability level—below its peak during the recession and above the typical rates in the 1990s.
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