US housing: more price acceleration
April 27, 2021 @ 17:50 +03:00
House prices in the USA are developing their acceleration. In February, the Federal Housing Finance Agency price index renewed its record growth rate to the same month a year earlier, rising to 12.3%.
From the S&P source, the price index in the 20 largest US metropolitans adds 11.9% to February last year. This is a high but not record-breaking rate as in 2004-2006 prices rose more rapidly.
On the demand side, the current price boom is due to low interest rates, an accumulated cash cushion and a desire from many people to update the home where they have spent the last year due to national lockdowns.
On the supply side, the bottlenecks consist of both the lockdowns of previous months and destroyed the capacity for inventories. This has not allowed supply to increase, driving prices up.
For the US, the house price boom is good news as it is accompanied by increased lending (many loans are taken out against mortgages) and generally supports economic activity.
The FxPro Analyst Team