Heading into the busy Spring season, US housing prices are no longer in free-fall, although, the nation’s real estate recovery is hardly uniform. While the West and Northeast have seen price growth, Midwest losses are in the double digits from a year ago, and the stronger markets are proving resilient to REO saturation. See the following article from Property Wire for more on this.
Residential property prices in the US are now 5.1% higher than they were last April, according to the latest home price index to be published.
But in the last few months prices have been falling and dropped another 5% in April on a rolling three month period, the figures from data provider Clear Capital show.
The index shows it is very much a mixed picture across the country. Price in the Midwest fell 11.3% from last year, down from 12.8% in March. Gains in the South dipped to 3.3% from 3.4%. But prices in the West have grown 4.6% from last year, while prices in the Northeast have grown 2.2%.
Among the best performing markets was Honolulu in Hawaii that saw a 3.3% increase from three months ago, the highest growth of any metro area in the country. In San Francisco, California, the area continues to lead the group in yearly price gains at 20.4% while maintaining a nearly flat quarterly price change of -0.4%. Home prices in the District of Columbia averaged an 8.4% rise from last year, ending a 42.8% drop from is peak in 2006.
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Alex Villacorta, senior statistician at Clear Capital, said an interesting dynamic their seeing is the distinction between markets that resist increased levels of Real Estate Owned (REO) property and those that remain sensitive to them.
‘For example, the highest performing metro areas have seen prices remain relatively flat over the last quarter despite REO saturation rates averaging just above 33%. Contrast this with the lowest performing areas which have seen prices drop dramatically with average declines of more than 10% and average REO saturation rate less than those in the highest performing areas,’ he explained.
‘This paradox suggests that price trends are not wholly dependent on distressed sale volume, and re-enforces the need to understand local market trends,’ he added.
‘However, the short term picture for these markets has improved somewhat from last month, and while prices continue to fall, their drop is less dramatic than that of previous months,’ the index report says. ‘This provides an early indication that prices might be searching for a bottom, rather than starting a steeper decline, especially with the arrival of the spring buying season.
‘The impact that increased sale volumes might have on prices is yet to be seen, it’s clear that spring and summer mark the arrival of better conditions to the housing market, making it easier to move inventory. This is evident by increased sale volumes, averaging 30% off winter lows, throughout the steep declines of the last three years,’ it concludes.
This article has been republished from Property Wire. You can also view this article at Property Wire, an international real estate news site.