The US is witnessing the strongest housing market boom since 2014, with record-low mortgage rates and a limited supply of homes, amid the ongoing pandemic stoking a surge in home prices.
Twenty US cities recorded an uptick in prices in December 2020, with Phoenix, San Diego, and Seattle posting the biggest gains, Bloomberg reported.
Phoenix recorded a 14.4-percent increase in home prices, the highest among all cities. Meanwhile, the overall gain was pegged at 10.8 percent in the West.
The surge in home prices beat expectations, with the S&P CoreLogic Case-Shiller 20-city composite index of property values climbing 10.1 percent from one year ago, its largest increase since 2014, Bloomberg reported.
The price gains were higher than the median estimate of 9.9 percent by economists surveyed by Bloomberg and followed a 9.2-percent surge in November. In fact, December was the fourth straight month of prices recording their largest growth since 2014.
Meanwhile, the national Case-Shiller index gained 10.4 percent, also posting its biggest jump since 2014.
"These data are consistent with the view that Covid has encouraged potential buyers to move from urban apartments to suburban homes," Craig Lazzara, global head of index investment strategy at S&P Dow Jones Indices, told Bloomberg.
The home-price rally started in July 2020 and picked up pace in the last few months of the year, as buyers tried to take advantage of historically low mortgage rates to purchase homes in suburbs.