Prices rose on U.S. homes for the fourth consecutive month in July, according to the most recent S&P/Case-Shiller home price index, bring prices up to their highest point in almost two years as low interest rates help keep demand strong.
The 20-city composite index measured a 1.6 percent increase in July, marking three straight months when all 20 of the biggest metropolitan city areas saw home price gains. In June, home prices were up by 2.3 percent, and July’s prices grew 1.2 percent from the previous year. Home prices are now back up to their summer 2003 level.
“The news on home prices in this report confirm recent good news about housing. 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,” said David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices in a Marketwatch press. “All in all, we are more optimistic about housing.”
Interest rates have bumped along rock-bottom territory for the past several months, making home buying more attractive to many and have allowed a release of pent-up demand for homes that has been growing since end of the Recession.
Minneapolis posted the largest monthly price gain, increasing by 3.7 percent from June. Also in the top five were Detroit at 3.3 percent, Chicago at 2.7 percent, Atlanta at 2.6 percent and Phoenix at 2.2 percent.
The cities that showed the least price improvement included Cleveland with only a 0.4 percent increase, Las Vegas with a 0.7 percent growth, and Charlotte, Dallas and Tampa all with a 0.9 percent increase.
Blitzer added a cautious hope that we have already seen the market bottom.
“The positive news in both the monthly and annual rates of change in home prices over the past few months signals a possible recovery in the housing market.”