Home prices are crossing the line again. After an epic housing crash, where values plummeted nationally by almost 35 percent, the nation is seeing new highs again. The median price of an existing home sold in May hit a record $239,700, according to the National Association of Realtors, which began tracking prices in 1968.
"We are seeing flashing yellow lights on affordability. People who are currently renting and want to convert into ownership — major difficulty," said Lawrence Yun, chief economist of the NAR. "Home prices are rising way too fast compared to people's income and wage growth."
The higher median price, where half the homes sold lower and half sold higher, in part reflects the fact that there is more sales activity on the higher end of the market. Other price indexes that measure repeat sales of similar homes show that, nationally at least, prices are still about 10 percent below the peak of 2006.
Some local markets, however, are far more frothy. San Francisco home prices set a new record in May for the second month in a row. The median price in the Bay Area was $700,000, according to CoreLogic. Orange County, California, also surpassed its peak, as have major metro markets in Texas, where home prices didn't fall as drastically during the housing crash.