Real Estate & Area News

US Home Prices Surge More than Expected

The Federal Housing Finance Agency reported Thursday that US home prices rose half of a percentage point from July to August, outpacing the consensus projection from a group of economists in a recent Bloomberg poll, which had called for a 0.3 percent uptick. The news sparked optimism about the economy following a pair of reports Wednesday showing existing home sales rose to a 14-month high and the unemployment rate fell to its lowest level in six years. Some economists expect price growth to taper off in the coming months, however, as homebuying levels slip to their typical slower levels in the fall and winter.

According to the FHFA's report, home values not only increased on a monthly basis in August, but were also up 4.8 percent from a year earlier. This already represents a slowdown in price growth, as values increased 8.3 percent from August 2012 to August 2013. Of the four regions of the US, the Pacific enjoyed the strongest surge in home values, with prices surging 7.8 percent. The Mountain region enjoyed growth of 6.2 percent, meanwhile, and the Northeast saw the smallest increase, at just 1.9 percent. With the gains, home prices in the US are now 5.8 percent below their April 2007 peak and at the same levels that were seen in late 2005.

October 23, 2014