Though financing costs remain low, high demand is continuing to push up home prices across the country. According to the recent Home Price Index released by global analytics firm CoreLogic, home prices rose 4.9% in June compared to a year earlier.

Month over month, home prices were up 1% over May, the largest monthly gain for the month of June since 2013. Despite rising home prices, low interest rates mean buyers need less income to afford a home, at least for now.

“Mortgage rates hit record lows this spring, which enhanced affordability for homebuyers,” said CoreLogic Chief Economist Dr. Frank Nothaft in a press release. “First-time buyers, and millennials in particular, have jumped at the opportunity to achieve homeownership.”

Taken on a micro level, however, local markets continued to fluctuate in June, largely due to demographic changes driven by the pandemic. For example, home prices in Philadelphia experienced an annual gain of 8.4% in June, as New York City residents purchased homes there, likely in an effort to migrate from the COVID-19 hotspot. Meanwhile, affordability constraints in San Francisco led to an annual decline in home prices of 0.2%.

In Chicago, home prices were up slightly last month, 1.2% higher than June 2019.

Overall, the housing market is showing surprising signs of resiliency in the face of the pandemic and related economic fallout, although CoreLogic’s forecast predicted a modest decline in home prices by June 2021.

On a local level, how far home prices fall will depend on a number of factors, including job market health, economic dependence on tourism, available housing inventory and the path of the pandemic itself.

The CoreLogic Market Risk Indicator, a monthly update of the overall health of housing markets across the country, predicted that metro areas with an elevated resurgence of COVID-19 cases — such as Prescott, Arizona, and Lake Havasu, Arizona — are at the greatest risk (above 60%) of a decline in home prices over the next 12 months. Other metro areas with a high risk of price declines include Las Vegas, Nevada; Peoria, Illinois; and Worchester, Massachusetts.

Despite the vulnerability of some local markets, overall the housing market is expected to lead economic recovery in the U.S., as home prices show their downside stickiness amid growing millennial demand and limited housing supply.

“Home price appreciation continues at a solid pace, reflecting fundamental strength in demand drivers and limited for-sale inventory,” added CoreLogic President and CEO Frank Martell in the press release. “As we move forward, we expect these price increases to moderate over the next twelve months. Given the economic outlook, housing remains a bright spot for the foreseeable future.”