Home prices shot up in the last month of 2016, but growth could slow through the next year, according to CoreLogic, a property information, analytics and data-enabled solutions provider.

Home prices increased 7.2% annually in December, and 0.8% from the previous month, according to the CoreLogic Home Price Index.

Click to Enlarge

(Source: CoreLogic)

“Last year ended with a bang with home prices up over 7% nationally, led largely by major metro areas,” CoreLogic President and CEO Anand Nallathambi said. “We expect prices to continue to rise just under 5% in 2017 buoyed by lack of supply and continued high demand.”

Home price growth could slow down next year, the CoreLogic HPI Forecase shows. Home prices will increase 4.7% annually in December 2017, and will increase by just 0.1% from December to January this year.

The CoreLogic HPI Forecast is a projection of home prices using the CoreLogic HPI and other economic variables. Values are derived from state-level forecasts by weighting indices according to the number of owner-occupied households for each state.

“As of the end of 2016, the CoreLogic national index was 3.9% below the peak reached in April 2006,” CoreLogic Chief Economist Frank Nothaft said. “We expect our national index to rise 4.7% during 2017, which would put homes prices at a new nominal peak before the end of this year.”