Although residential real estate prices are still falling on an annual basis, real estate research firm Zillow reported a 0.5% gain from April to May. The Home Index shows it is the third consecutive month of gains and is paired with Zillow’s Rent Index indicating rises in rents in 77% of markets analyzed. Experts are impressed to see gains in the midst of so many foreclosures, particularly in embattled areas like Miami. The bad news, however, is that some prices continue to decline in many primary and secondary markets including Chicago, St. Louis, Sacramento, Denver and Pittsburgh. For more on this continue reading the following article from Property Wire.
National home values in the United State rose for the third month in a row in May, climbing 0.5% from April, the latest Zillow home price index shows.
But prices are still falling on an annual basis, down 0.9% compared to May 2011 although this is the smallest year on year decline since October 2007. National rents also rose from April to May, increasing 1.8%, according to the Zillow Rent Index with rents increasing on a monthly basis in 77% the index. The greatest increase was seen in the Phoenix metro area, up 9% annually and 1.9% from April to May.
In the Miami-Fort Lauderdale metro area values rose 5.2% year on year and 2.2% month on month. ‘It is promising to see consecutive months of national home value increases, especially during a period in which we’d expected more downward pressure due to foreclosures,’ said Zillow chief economist Stan Humphries.
Attention has now shifted to the tug of war situation with inventory, where buyers want to buy but sellers don’t want to, or can’t, sell. ‘This inventory phenomenon, due to both the broader issue of negative equity that is keeping people in their homes and to rational seller behaviour at a market bottom, will make for a more volatile housing recovery than what we initially expected,’ he explained.
Foreclosures continued to decline in May, with 6.3 out of every 10,000 homes in the country being foreclosed. That was down from 7.2 out of every 10,000 in April. Some areas are still seeing prices down compared with a year ago including Chicago with a 6.8% decline year on year, St Louis down 3.8% and Sacramento in California down 3.7%. Denver in Colorado posted a 2.8% increase year on year, and Pittsburgh was up 2.4%.
This article was republished with permission from Property Wire.