U.S. Home Prices Grow At Fastest Pace Since 2006
By Bobby Freeman, Florida Realtors® // March 27, 2013
REAL ESTATE ON THE SPACE COAST
ABOVE VIDEO: Lawrence Yun, NAR chief economist, said conditions for continued housing improvement are at play. “Job growth in the improving economy and pent-up demand are causing both home sales and rental leasing to rise. Though home prices are rising much faster than rents, historically low mortgage rates are still making home purchases affordable,” said Yun.
BREVARD COUNTY, FLORIDA – “3..2..1….Blast Off!” A common phrase heard on Florida’s Space Coast as many rockets continue to launch from NASA. In addition to the rockets blasting off into space, so are U.S. home prices.
In January 2013 U.S. home prices rose at the fastest annual pace since June 2006 which was just before the housing bubble explosion according to a recent report from Standard & Poor’s/Case-Shiller.
This gain indicates housing recovery strengthening ahead of the all-important spring buying season.
The Standard & Poor’s/Case-Shiller 20-city home price index climbed 8.1 percent in the 12 months ending in January. That’s up from a 6.8 annual gain in December. Prices rose in all 20 cities. Eight markets posted double-digit increases, led by a 23.2 percent gain in Phoenix.
The S&P/Case-Shiller index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The January figures are the latest available.
PRICES STILL BELOW 2006 BUBBLE PEAK
Home prices nationwide are still 29 percent below their peak reached at the height of the housing bubble in August 2006. They are only back to where they were in August 2003.
Higher home prices actually help encourage more people to purchase before prices rise further.
Other recent reports have shown a strengthening recovery in housing, helped by near-record-low mortgage rates. Construction of single-family homes rose in February at the fastest pace in 4 ½ years. Sales of previously owned homes rose last month to their fastest pace in more than three years.
Lawrence Yun, NAR chief economist, said conditions for continued housing improvement are at play.
“Job growth in the improving economy and pent-up demand are causing both home sales and rental leasing to rise. Though home prices are rising much faster than rents, historically low mortgage rates are still making home purchases affordable,” said Yun.
“The only headwinds are limited housing inventory, which varies greatly around the country, and credit conditions that remain too restrictive.”
The national median existing-home price for all housing types was $173,600 in February, up 11.6 percent from February 2012. The last time there were 12 consecutive months of year-over-year price increases was from June 2005 to May 2006. The February gain is the strongest since November 2005 when it was 12.9 percent above a year earlier.
So if you are waiting for prices to go down, you maybe sitting on the fence watching the rockets and home prices go up for awhile.
ABOUT THE AUTHOR
Bobby Freeman, a life-time resident of Brevard County, has been a top Realtor in the area for two decades. In his first year as an agent, Freeman received a Rising Star award from his Brokers. Since then he has achieved numerous sales awards and has recently been presented with the prestigious RE/MAX Hall of Fame Award.
Freeman, Jennifer McCoy and Nikki McCoy Freeman are family partners for RE/MAX Elite’s McCoy-Freeman Group. Together they have more than 30 years of extensive experience in all aspects of the real estate industry and have sold over $180 million. Among McCoy-Freeman Group’s achievement are RE/MAX Hall of Fame, RE/MAX 100% Club, Certified Distressed Property Experts (CDPE), Accredited Buyer’s Representative (ABR) and voted Best Realtor in Brevard County. The group has been featured in many news publications including CNN Money Magazine, CNNMoney.com, WFTV 9 ABC News, Coastal Condo Living, & Hot Retirement Towns Magazine and SpaceCoastDaily.com.
For more information log on to BrevardRealtyConnection.