US Housing Recovery is Record-Breaking Strong

US house prices rose 12.2 percent in May in the biggest year on year growth recorded since March 2006 according to the only index that really…

US house prices rose 12.2 percent in May in the biggest year on year growth recorded since March 2006 according to the -- only index that really matters, -- the S&P Case-Shiller Home Index based on average growth in the 20 cities the index tracks.

According to the report prices in all 20 cities grew, with prices in both Dallas and Denver growing to reach new-highs; surpassing their pre-crisis peaks. This is the first time any city in the index has done this according to the firm.

On a monthly basis prices grew by 2.4 percent, with all cities in the index recording growth according to the report.

"Home prices continue to strengthen," said David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices.

The index is lagged though, and according to the latest data sales are slowing due to rises in mortgage rates. Regardless of that though, the Case-Shiller index shows the undeniably nationwide strength of the recovery. Apart from the fact that Dallas and Denver beat their pre-crisis peaks, 5 more cities set records as well. Atlanta, Chicago, San Diego, San Francisco and Seattle all saw prices grow more than 3% on the month, not record-breaking in its own right but that is the first time 5 cities have grown by more than 3 percent over a month in the history of the index.

Growth was strongest in the West and South West of the country, with prices in San Francisco up by 24.5 percent compared to last year, and Las Vegas wasn't far behind at 23.3 percent followed by Phoenix at 20.6 percent. Meanwhile Washington DC, Cleveland and New York saw the weakest growth at 6.5 percent, 3.4 percent and 3.3 percent respectively.

"The overall report points to some shifts among various markets," Mr. Blitzer said. "Washington DC is no longer the standout leader and the eastern Sunbelt cities, Miami and Tampa, are lagging behind their western counterparts."

- Friday 02 August 2013

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