Home Prices Record 5.5 Percent YoY Rise

US home prices for April rise slower than expected

NEW YORK, June 27 US single-family home prices accelerated at a slower pace than expected in April, a survey showed on Tuesday.

In April, home-price gains slowed marginally, according to the S&P CoreLogic Case-Shiller price indices.

The newly released report, which tracks 20 major metropolitan areas in the country, shows home prices in Miami increased by 0.6 percent from March to April.

The increases reflect the nationwide trend of higher real estate prices, as all 20 markets studied in the indices rose on an annual basis, and 19 of the 20 did in the monthly comparison.

"The question is not if home prices can climb without any limit; they can't", Blitzer said.

Seattle, Portland, Oregon, and Dallas reported the highest year-over-year gains in April.

David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, isn't predicting a slowdown soon.

"If mortgage rates, now near 4 percent, rise further, this could deter more people from selling and keep pressure on inventories and prices", Blitzer said in a statement.

Seven cities reported greater price increases in the year ending April 2017 versus the year ending March 2017. The inventory of homes for sale stood at 11,615 last month, which is 2.3 months of housing supply, according to the Minneapolis Area Association of Realtors. "For the moment, conditions appear favorable for avoiding a crash". They can't. Rather, will home-price gains gently slow, or will they crash and take the economy down with them? Moreover, mortgage default rates are low and household debt levels are manageable.

Many homeowners may be reluctant to sell because prices have been rising so rapidly. Total mortgage debt outstanding is $14.4 trillion, about $400 billion below the record set in 2008. Household finances should be able to weather a fairly large price drop. Those gains were the highest in almost three years.

"Two conditions in today's market that can quickly change the home price trend are swings in the labor market or home inventory", says Bill Banfield, executive vice president at Quicken Loans. They attribute the scarcity in part to an increasing number of single-family homes going up for rent-increasingly lucrative to long-time homeowners and investors alike in the current rental market.

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