U.S. home prices post first 12-month gain since 2010
U.S. home prices rose in June from the same month last year, the first year-over-year increase since the summer of 2010. The increase is the latest evidence of a nascent recovery in the housing market.
Southwest Florida has been experiencing a rebound in prices for months now.
The Standard & Poor's/Case-Shiller national home price index released Tuesday showed a gain of 0.5 percent from June 2011.
All 20 cities tracked by the index also rose in June from May, the second consecutive time in which every city posted month-over-month gains. All but two cities posted stronger gains in June than May.
Detroit, Minneapolis, Chicago and Atlanta recorded the biggest one-month gains.
No cities in Southwest Florida are included in the Case-Shiller measure, but Tampa and Miami are: Tampa's prices were up 3.4 percent from a year ago while Miami's were up 4.4 percent.
"The combined positive news coming from both monthly and annual rates of change in home prices bode well for the housing market," said David Blitzer, chairman of the S&P's index committee.
Separate data from the Sarasota Association of Realtors showed the median price for a single-family home sold during July in the group's territory was $178,000. That is up more than 30 percent from the market nadir recorded 16 months ago, when the median price was $137,500.
The S&P/Case-Shiller monthly index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The June figures are the latest available.
The increases partly reflect the effect of seasonal buying. The month-to-month prices are not adjusted for seasonal factors.
Still, a measure of national prices rose for the third straight month. Home prices jumped nearly 7 percent in the April-June quarter, compared with the previous quarter.
The housing market is making a modest but steady recovery in part because homes are more affordable: Mortgage rates have fallen to near-record lows. Housing prices are about one-third lower than at the peak of the housing bubble in 2006. Those trends have helped lift sales of both new and previously occupied homes.
Sales of previously occupied homes increased in July from June, the National Association of Realtors said last week. Sales have jumped 10 percent in the past year.
Builders are growing more confident after seeing more traffic from potential buyers. Last month, they applied for the largest number of building permits in nearly four years.
The housing market has a long way to go to reach a full recovery. Some economists forecast that sales of previously occupied homes will rise 8 percent this year to about 4.6 million. That is still well below the 5.5 million annual sales pace considered healthy.
Sales have been held back by a low supply of homes on the market and by tight credit standards, economists said. Many would-be buyers are having trouble qualifying for loans or cannot afford larger down payments required by banks. A Federal Reserve report last month showed many banks tightened their mortgage credit standards this summer.
Still, the housing market is steadily improving and is poised to contribute to economic growth this year. Modest economic growth and job gains are encouraging more Americans to buy homes.