Home prices rise in region but at slowest pace in US
- Author: Rita Burton Mar 02, 2017,
Mar 02, 2017, 0:42
Economists had expected the annual rate of home price growth to come in unchanged compared to 5.3 percent increase originally reported for the previous month.
Among cities, Seattle posted the highest annual gain of 10.8 percent, followed by Portland, 10 percent, and Denver, 8.9 percent.
The slowest annual gain was in NY at 3.1% with Washington at 4.2%, although both cities recorded a faster pace than seen in November.
Yet the latest year-over-year figure tops the 6.1 percent increase from November 2016 as well as the 6.5 percent bump in prices S&P CoreLogic Case-Shiller reported in October 2016.
Home prices in New Jersey have lagged behind because of slow job growth and a continued backlog of distressed properties in the foreclosure pipeline.
"Home prices continue to advance, with the national average rising faster than at any time in the last two-and-a-half years", says David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, in a statement.
Parham said the Charlotte region is down to a 2.3-month home supply, which "is causing the average price to go up more". That compares with a national increase of 5.8 percent.More news: GOP congressman calls for special prosecutor in Russian Federation investigation
The Case-Shiller index covers roughly half of USA homes. Consumer prices are higher today than 20 or 30 years ago, while the inflation rate is lower.
Many analysts expect interest rates to rise this year, which would make it more hard for first-time buyers to get into the housing market.
"In short, home prices continue to rise at a solid pace, with no sign of any significant slowing", said Jim O'Sullivan, chief USA economist at High Frequency Economics. "Another factor supporting rising home prices is mortgage rates".
When adjusted for inflation, the index's nationwide annual increase of 5.8 percent would be 3.8 percent.
On a non-seasonally adjusted basis, prices increased 0.3 percent from November. Since 1975, the average pace is 1.3%; about two-thirds of the time, the rate is between -4% and +7%. The average interest rate on all mortgage loans was 4.17 percent, up 26 basis points from 3.91 in December, while the average interest rate on conventional, 30-year, fixed-rate mortgages of $424,100 or less was 4.37 percent, up 29 basis points from 4.08 in December.
"Still, we aren't expecting a sustained surge in home sales anytime soon, but prices will keep rising".