Home Prices See Monthy Increase, Still a Long Way to Go

For the first time in eight months, home prices saw a month-over-month increase in April according to the Standard & Poors/Case-Shiller Home Price Indices.

During April, the 10- and 20-City composite indices increased 0.8% and 0.7% respectively, compared with their March 2011 levels. Both indices remain below their April 2010 levels.

“In a welcome shift from recent months, this month is better than last—April’s numbers beat March,” says David M. Blitzer, chairman of the Index Committee at S&P Indices. “However, the seasonally adjusted numbers show that much of the improvement reflects the beginning of the Spring-Summer home buying season. It is much too early to tell if this is a turning point or simply due to some warmer weather.”

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Compared to April 2010, the indices show declines of 3.1% and 4%, respectively, with metropolitan statistical areas Charlotte, Chicago, Detroit, Las Vegas, Miami and Tampa seeing new index lows.

Regionally, 10 of the 20 MSAs showed positive monthly changes.

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One the whole, the monthly uptick has been detected in other housing indicators as well.

“Other housing statistics show the same trends. Single-family housing starts were up in May, but still well below their 2010 levels and still very close to their 30-year low,” Blitzer said. “Existing home sales rose in May, but are still about 15% below last year’s pace and about 35% below their 2005 pace. …For a real recovery we would need to see several months of increasing home prices, large enough to shift the annual momentum to the positive side.  In short, better news, but still a lot of questions and a long way to go.”

Written by Elizabeth Ecker

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