Home prices were on the rise in 83 percent of the metros across the country in the second quarter compared to a year earlier, according to the National Association of REALTORS®.
Read more: Home Sales Up as First-Time Buyers Re-Emerge
Most notable was San Jose, Calif., which become the first city where home prices now average above $1 million. NAR reports that the median home price in San Jose is $1.085 million – the highest in the country, followed by San Francisco at $885,600 and Anaheim-Santa Ana, Calif., at $742,200.
Home prices are reaching record highs, mostly driven by rising prices in California and cities in the northwest like Portland and Seattle. Twenty-five out of the 178 metro areas analyzed by NAR saw double-digit price gains, down from the 34 metro areas that saw double-digit gains last year.
The national median home price was $240,700 in the second quarter, a nearly 5 percent increase from the previous peak reached in the second quarter of 2015.
“Many listings in a majority of markets—and especially those in lower price ranges—had multiple offers and went under contract quickly because of severely inadequate supply,” says Lawrence Yun, NAR’s chief economist. “This in turn dented affordability and without a doubt priced out a segment of buyers attempting to seek relief from fast-growing rents.”
The following metros saw home prices grow by the fastest rates in the second quarter over the past year:
- Boulder, Colo.: 18.5% (% change from second quarter 2015 to second quarter of 2016)
- Elmira, N.Y.: 17.6%
- Springfield, Ill.: 17.1%
- Port St. Lucie, Fla.: 16.1%
- Cumberland, Md.-W.Va.: 15.2%
- Rockford, Ill.: 15.1%
- Deltona-Daytona Beach-Ormond Beach, Fla.: 14.7%
- Tampa-St. Petersburg-Clearwater, Fla.: 14.2%
- Toledo, Ohio: 13.9%
- Norwich-New London, Conn.: 13.8%
Source: “The Typical Home in San Jose Now Costs More Than $1 Million,” The Wall Street Journal (Aug. 10, 2016)