US home prices up 7.2% year on year and now stabilising
Home prices in the US have risen nationally by 7.2% but values are now stabilising and vary considerably according to location, the latest figures from real estate data provider Clear Capital shows. The latest annual figure is a stark contrast to the fall of 1.40% recorded a year ago and quarterly gains, at around 1%, demonstrate that the market is on track to hit annual forecasted gains of 4% which is in line with average historical rates of growth.
Regionally, markets vary with Phoenix seeing annual growth of 25.8% in April and Las Vegas 24.3% while at the bottom end was Birmingham, Detroit and Cleveland. However, market experts should not be fooled by these large headline numbers, according to Alex Villacorta, director of research and analytics at Clear Capital.
‘Last year was a turning point for the market where the year started with prices at virtually their lowest point and saw a very strong correction through the year. Now, however, the market is stabilising and the large yearly and even quarterly gains of 2012 are starting to subside, which is a good thing as markets return to more normal rates of growth,’ he said. ‘Much of the gains we see right now in the yearly trends are a reflection of the market lows in 2012, rather than a function of recent short term momentum. Having said that, we are still confident in the sustainability of the recovery as the market continues to adjust to the new normal,’ he explained.
Quote from PropertyCommunity.com : “Residential property and sales in the United States remain higher than a year ago and 2013 is set to be an even better year.”
‘Moderate improvements in the broader economic landscape likely haven’t offered potential home buyers strong reason to jump back in at the start of the season. We do expect to see more buyers and sellers ready to take action over the next several months as rising prices continue to free up some underwater mortgages,’ he pointed out. ‘And while the national market waits for a spring boost in short term gains, markets like Las Vegas offer a reminder that pockets of the housing market will continue to vastly outperform national and regional markets,’ he added.
On average, the lowest performing markets were nearly unchanged over both the previous rolling quarter and year, with losses of just 0.9% and 0.1%, respectively. In fact, nine out of the lowest 15 metros saw price changes of less than 1% over the last quarter. Villacorta said that stability in the lowest performing metros offers encouragement that even markets lagging in recovery are starting to find a bottom, creating a stronger foundation for the progression of the recovery at the national level.