Home prices rise 5% in June: S&P/Case-Shiller

Sales rates are tracking at roughly double the pace of price growth, a mismatch that points ahead to price acceleration given how thin inventories are right now in the housing sector. Washington, D.C., posted the smallest gain, just 1.6 percent.

U.S. home prices continued to rise in June, according to the S&P/Case-Shiller Home Price Index, but the increase fell short of analyst estimates. The biggest year-over-year increases in prices occurred in Denver (10.2%), San Francisco (9.5%) and Dallas (8.2%).

Real estate data firm Zillow says rents rose a seasonally adjusted 4.2 percent from a year ago.

The trend is most pronounced around Washington, where home values slipped on an annual as well as on a monthly basis. Housing starts surged in July, and sales of new homes have been heading higher. “These have changed for the better in the last few months“.

“A stock market correction is unlikely to do much damage to the housing market; a full-blown bear market dropping more than 20 percent would present some difficulties for housing and for other economic sectors (Other OTC: UBGXF – news)”. For now, the average rate on 30-year fixed-rate mortgages remains below 4 percent.

“The price gains have been consistent as the unemployment rate declined with steady inflation and an unchanged Fed policy”, David Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.

Housing is also drawing strength from a healthy labor market. The index measures prices compared with those in January 2000 and creates a three-month moving average.