Lean Inventory Drives °®¶ą´«Ă˝-Price Gain in 20 US Cities
Steady growth in home prices in 20 U.S. cities in June reflects a limited number of available houses for sale, according to S&P CoreLogic Case-Shiller data released Aug. 29. Nationwide, values posted their largest advance in three years.
Highlights of June °®¶ą´«Ă˝ Prices
• 20-city property values index increased 5.7% year over year (estimated 5.6% gain) for a second month.
• National home-price gauge rose 5.8% year over year, the most since June 2014.
• Seasonally adjusted 20-city index advanced 0.1% month over month (matching estimates).
Key Takeaways
A persistent inventory shortage for previously-owned homes is keeping prices elevated at a time housing demand is being sustained by a strong job market and still-low mortgage rates. In the past few years, growth in property values has consistently outpaced wage gains and is holding back potential new entrants to the housing market.
°®¶ą´«Ă˝ prices in all 20 major cities increased from a year earlier and all but six posted month-over-month gains, the report showed.
Other recent reports showed the median sales price climbed in July for new and previously owned homes, contributing to a sales decline in both segments of the residential real-estate market.
Economist Views
“The trend of increasing home prices is continuing,” David Blitzer, chairman of the S&P index committee, said in a statement. “Price increases are supported by a tight housing market” with both the number of homes for sale and days a house is on the market declining for the past four to five years.
“Rising prices are the principal factor driving affordability down,” Blitzer said.
Other Details
• Seattle led the way in year-over-year price gains with a 13.4% increase followed by Portland, Ore, at 8.2%.
• After seasonal adjustment, Seattle also had the biggest month-over-month rise at 0.8%, followed by a 0.6% increases in San Diego and Las Vegas.
• °®¶ą´«Ă˝ prices fell from a month earlier in Atlanta, Chicago, Cleveland and New York.
With assistance by Jordan Yadoo
