After plummeting 33% during the recession a decade ago, U.S. house prices have returned to peak levels, bouncing back 51% nationally, according to a report Thursday from global property analysts CoreLogic.
A combination of favorable interest rates and relaxed standards for mortgage loans resulted in peak residential home prices across the country in 2006, the report said. But by 2007, prices had collapsed and continued to log steady declines through 2011.
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The average home price is now 1% higher than it was in 2006, the report said, and the average year-over-year home equity gain was $14,888 in the third quarter of 2017, indicating that the housing market has widely recovered since “the trough,” an expression used in the report to describe the bottoming out of the market.
“West Coast states, such as California, Washington and Oregon are seeing some of largest trough-to-current growth rates in home prices,” said Dr. Frank Nothaft, chief economist for CoreLogic, in the report. “Greater demand and lower supply–as well as booming job markets–have given some of the hardest-hit housing markets a boost in home prices. Yet, many are still not back to pre-crash levels.”
Nevada suffered the biggest drop during the recession—which lasted from 2007 to 2009—with a 60% decline in home prices between the peak in 2006 to bottoming out in 2011. Arizona and Florida followed, with declines of 51% and 50% respectively, the report said. But in Nevada, home prices are still 23% below their pre-recession peak, while Arizona and Florida are both still 16% below peak.
Some states have fared much better though. Prices in North Dakota, which had the lowest recorded price drop of 2% during the recession, now stand 48% higher than the previous 2006 peak, the highest rise recorded in the report.
Colorado logged the second highest price gains, rising 44%, after dropping 14% during the recession.
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