Home Prices Show Strengthening Gains
- Peter KingDecember 17, 2012 - MortgageLoan.com
U.S. home prices have been showing strong gains in recent months, with year-over-year price increases picking up rapidly since entering positive territory in midsummer, according to data from the mortgage collateral firm FNC.
The latest FNC index of home sales in 100 major metropolitan areas showed a 4.2 annual increase in prices of nondistressed homes compared to Oct. 2011, the company announced today. The rate of annual price increases in the index has roughly doubled each month since moving into positive territory in July.
July was the first time since early 2007 that the index showed home sales prices higher than they were 12 months earlier. On a month-to-month basis, the index has now risen for eight consecutive month and prices are 5.1 percent higher than at the beginning of the year. October home prices in the index were up 0.4 percent compared to September.
Homeowners feeling more optimistic
The report attributes the increase to generally improving conditions in the housing market, including a decline in foreclosures and increasing home sales, as well as rising expectations among homeowners that are producing higher listing prices and smaller concessions on those prices.
The FNC price indices exclude data from foreclosure sales. However, higher foreclosure rates tend to suppress conventional home prices. According to FNC figures, foreclosures made up 17.6 percent of home sales in October, down from 23.5 percent one year ago.
Home prices are showing unusually strong growth in the Phoenix market, which was among the hardest-hit in the nation by the housing crash. Phoenix home prices are up 21.3 percent compared to their Oct. 2011 levels, by far the strongest annual price gains in the nation. Other strong gains were seen in Denver, Detroit, Washington, D.C., and Miami, with annual increases ranging from 13.7 percent to 7.1 percent.
Only two major markets, Columbus, Ohio and Chicago, failed to show year-over-year and year-to-date price increases.
FNC specializes in real estate collateral technology, data collection and analysis for the purpose of supporting home appraisals used in making mortgage loans nationwide.
First published at: http://www.mortgageloan.com/home-prices-show-strengthening-gains-9319
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