S&P Reports Strong Home Price Gains
Stronger-than-expected home price gains were reported today, a sign that the housing recovery may be gathering strength.
Home prices in October showed an annual gain of 4.3 percent, according to the latest Standard & Poor's/Cass-Shiller index of 20 major metropolitan areas, released today. That's up from a 3.0 percent gain for the 12 months that ended in September and stronger than analysts had expected.
Prices were down slightly on a month-to-month basis, with the index down 0.1 percent from September's level, a change attributed to seasonal factors in the unadjusted index.
"Annual rates of change in home prices are a better indicator of the performance of the housing market than the month-over-month changes because home prices tend to be lower in fall and winter than in spring and summer," said David Blitzer, chair of the S&P Index Committee.
"Looking over this report, and considering other data on housing starts and sales, it is clear that the housing recovery is gathering strength," he added.
Nineteen of the 20 housing markets covered by the survey showed annual gains in October, Blitzer said, while only three showed monthly declines, despite the 0.1 percent monthly decline in the index overall.
Detroit, San Francisco, Phoenix see strong gains
Several cities that experienced large price declines in the housing downturn experienced strong price increases over the past 12 months, led by the Detroit metropolitan area, where home prices are up 24.2 percent from their October 2011 levels. Detroit prices still remain about 20 percent below their level of 12 years ago.
Strong price gains have also been seen in San Francisco and Phoenix, with prices up 22.5 percent and 22.1 percent from their recent lows.
Overall, prices in the 20 city index are at about their same level as in 2003 and remain about 30 percent below their pre-crash peaks reached in mid-2006.
First published at: http://www.mortgageloan.com/home-prices-show-strong-annual-gains-9325