Housing Market Metrics Strong

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No matter who you get your data from, almost all housing market metrics lately have been improving.

The 10-city composite S&P/Case-Shiller Home Price Index increased 1.5 percent between June and July, S&P Dow Jones Indices reported Tuesday.

A 1.6 percent increase was reported for the 20-city composite S&P/Case-Shiller Home Price Index.

All 20 cities and both indices have increased for three consecutive months.

With a 3.7 percent increase from June, Minneapolis had the most appreciation. Detroit followed with 3.3 percent, then 2.7 percent in Chicago, 2.6 percent in Atlanta and 2.2 percent in Phoenix. At 0.4 percent, Cleveland’s increase was smallest.

“The news on home prices in this report confirm recent good news about housing,” S&P Dow Jones Indices Chairman of the Index Committee David M. Blitzer said in the announcement. “Single-family housing starts are well ahead of last year’s pace, existing home sales are up, the inventory of homes for sale is down and foreclosure activity is slowing. All in all, we are more optimistic about housing.”

Another report released Tuesday from the Federal Housing Finance indicated that the FHFA monthly House Price Index was up 0.2 percent between June and July. Compared to a year earlier, FHFA’s index was 3.7 percent higher.

The regulator utilized data from loans owned or guaranteed by Fannie Mae and Freddie Mac to determine the index level.

FHFA’s index is 16.4 percent lower than its April 2007 peak and currently stands at the same level as in June 2004.

Existing home sales increased 2.3 percent from June to come in at 4.47 million units in July, according to the National Association of Realtors. Compared to July 2011, existing home sales were up 10.4 percent.

NAR reported last week that existing home sales during August were up another 7.8 percent in August to a seasonally adjusted annual rate of 4.82 million units. August activity came in 9.3 percent better than a year earlier.

Distressed homes, including foreclosures and short sales, that were sold at deep discounts accounted for 22 percent of August sales.

Another real estate metric, the number housing starts, increased 2.3 percent in August to a seasonally adjusted annual rate of 750,000 units, the National Association of Home Builders reported last week. The improvement reflected single-family strength, with single-family construction up 5.5 percent to 535,000 units — the fastest pace in more than two years.

“The pace of overall housing production has been edging gradually upward all year as consumers become more confident in their local housing markets, and the latest data are further evidence that the housing recovery is here to stay,” NAHB Chief Economist David Crowe said in the report. “That said, the pace of this recovery continues to be constrained by various hurdles, including a tough lending environment, inaccurate appraisals and more recently, rising prices on key building materials.”

The Commerce Department reported on Sept. 19 that building permits were at a seasonally adjusted annual rate of 803,000 in August, off 1.0 percent from July’s revised rate but 24.5 percent better than August 2011.

Housing starts, meanwhile, climbed 2.3 percent from July to a seasonally adjusted rate of 750,000. Housing starts shot up 29.1 percent from the same month last year.


Mortgage Daily Staff


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