That’s how much one measure of home prices has risen since the pandemic hit, showing how dramatically the market has changed even if recent signs of cooling bear out.
Home prices may not be rising quite as fast as they had been, but the magnitude of the hikes during the pandemic housing boom still means that listings that might have been unthinkable in 2019 have become the new normal. In April, prices were 19.9% higher than last April—slightly less than the record 20.4% increase seen in March but still 42% higher than February 2020, before COVID-19 emerged, real estate data company Black Knight said Monday in releasing its latest home price index.
The boom in prices has created unprecedented wealth for homeowners, but put homeownership farther out of reach for those not in the club. The sky-high prices of the pandemic era were hard enough on prospective buyers before a spike in mortgage rates this spring made purchases that much less affordable, sapping the volume of home sales in the U.S. Experts predict the decline in demand, which has already begun to replenish the number of for-sale listings, will start to impact prices too.
“It really is a bifurcated landscape—one that grows ever more challenging for those looking to purchase a home but is simultaneously a boon for those who already own and have seen their housing wealth rise substantially over the last couple of years,” said Ben Graboske, president of Black Knight’s data and analytics division. “Depending upon where you stand, this could be the best or worst of all possible markets.”
Through March, the average homeowner had $207,000 in so-called tappable equity, $80,000 more than when COVID-19 struck, and more than twice what they had during the previous housing peak in 2006, Black Knight said. (Equity refers to how much more a home is worth than what the mortgage-holder owes on it, and the “tappable” kind is the portion the homeowner could convert into cash—effectively using their houses as piggy banks—while still having a 20% stake in their home.)
Meanwhile, things have gotten that much harder for those on the outside looking in. As of mid-May, a typical monthly mortgage payment for a newly purchased home had risen $865—a punishing 79%—since the pandemic began, Black Knight said.
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