Prices for U.S. homes gained 18.4% in October, six times the increase recorded in the year before the pandemic began, according to the S&P CoreLogic Case-Shiller index.
The median U.S. sales price of a new home in November was $416,900, up 18.8% from a year earlier, according to a Commerce Department report.
Mortgage rates fell as investors' worries about the hyper-transmissible Omicron variant outweighed inflation jitters.
An increase in household formation as the U.S. economy emerges from the pandemic will support home sales in 2022, according to Mark Fleming, chief economist at First American.
Sales of existing homes rose 1.9% in November as homebuyers rushed to lock in low interest rates, NAR said in a report.
Some lenders offer mortgages for doctors and dentists that allow higher debts such as student loans.
Despite a half-percentage-point gain in home loan rates, real estate sales likely will reach a 16-year high in 2022, CoreLogic's chief economist said.
Homebuilder confidence rose to a 10-month high in December, signaling an expanded supply of new houses available for sale next year.
The average U.S. rate for a 30-year fixed home loan rose to the highest level in more than a month as the Fed stepped away from the bond markets.
The breakneck pace of home price gains made it tough to be a first-time property buyer in the third quarter, according to NAR data.
