If you seized property investment opportunities in Dallas and Denver during the market crash, you'll no doubt be celebrating right now. The two cities reached record high real estate values in May, surpassing their pre-financial crisis peaks in June 2007 and August 2006, according to the S&P/Case-Shiller House Price Indices. This is the first time any city has made a new all-time high since the crash.
Not only does the performance of Dallas and Denver mean good news for the local market, it indicates a change in overall trends. David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, said: "The overall report points to some shifts among various markets: Washington DC is no longer the standout leader and the eastern Sunbelt cities, Miami and Tampa, are lagging behind their western counterparts."
Among the other cities performing well during May were Atlanta, Chicago, San Diego, San Francisco and Seattle. All posted monthly gains of over three per cent - the first time this has happened. These strong performances and those of other cities helped the ten and 20-city composites rise by 2.5 per cent and 2.4 per cent respectively month-on-month. The best year-on-year gains since March 2006 were also recorded for ten and 20-city composites, with both increasing 11.8 per cent and 12.2 per cent respectively.
"The south-west and the west saw the strongest year-over-year gains as San Francisco home prices rose 24.5 per cent followed by Las Vegas (23.3 per cent) and Phoenix (20.6 per cent)," Mr Blitzer said. New York, Cleveland and Washington DC posted the weakest gains of 3.3 per cent, 3.4 per cent and 6.5 per cent respectively. After seasonal adjustments, Cleveland and Minneapolis were actually down slightly.
One thing is certainly clear - the US property market is on the road to recovery and prices are likely only to rise in key areas. Investors should do their research and target up and coming markets, which are performing stronger than many of the main business centres.
- Monday 05 August 2013