With fewer homes on the market, prices are rising past sustainable levels in many major metros.
CNBC reports that 23 of the nation’s 50 largest housing markets are overvalued, according to CoreLogic data. A market is considered overvalued if home prices are 10 percent higher than long-term sustainable levels. The Pacific Northwest, Washington D.C., Miami, Las Vegas, Salt Lake City, and Denver are among the places with overvalued real estate.
Only eight of the markets were considered undervalued, and the remaining 19 were deemed properly valued. Nationally, home prices were 6.7 percent higher in July compared to the year before.
Low supply is the main driver of prices. Inventory was down 9 percent in July from the year before.
"Home prices in July continued to rise at a solid pace with no signs of slowing down," said Frank Martell, president and CEO of CoreLogic. "The combination of steadily rising purchase demand along with very tight inventory of unsold homes should keep upward pressure on home prices for the remainder of this year.”
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