Home Prices Continue to Increase

The S&P/Case-Shiller home price index for May increased by 4.9% year-over-year for the 20-city composite index and by 4.7% for the 10-city composite index.

The largest month-over-month gains came in Boston and Cleveland, where prices rose 1.5% from April.

Financial experts predict the rise in home sales in recent months is connected to a boost in hiring and the economy.

San Francisco and Denver posted the highest year-over-year gains, with respective price increases of 9.7 percent and 10.0 percent. Washington, D.C. posted the smallest increase at 1.3 percent.

Prices rose 1.1% month-over-month when not seasonally adjusted. Prices rose in all 20 cities from a year earlier. Economists had expected a 0.3 percent increase. That is the fastest pace since February 2007. This would imply a continued modest slowing in the monthly rates from the strong run at the end of previous year.

Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices said, “Nationally, single family home price increases have settled into a steady 4%-5% annual pace following the double-digit bubbly pattern of 2013”. Sales of new homes are low compared to sales of existing homes.

That has led to aggressive efforts by buyers to grab homes: The typical property was on the market for just 34 days in June, down from 40 in May and the shortest time since the Realtors’ group began tracking the data in May 2011.