US home prices rose an average of 1.3% in April according to the latest S&P Case-Shiller home price index. Prices rose in both the 10-city and 20-city indexes after seven consecutive months of decline.
On a monthly basis, only Detroit of the 20 metropolitan statistical areas (MSAs) saw prices decline, and 18 of 20 MSAs enjoyed a better annualized rate of return. Only New York and Detroit showed lower rates of return for April. The report notes:
It has been a long time since we enjoyed such broad-based gains. While one month does not make a trend, particularly during seasonally strong buying months, the combination of rising positive monthly index levels and improving annual returns is a good sign.
The annualized rate of return is still negative, however, just by a smaller amount. On the 10-city index, April’s annual return was -2.2% compared with -2.9% in March, and on the 20-city index the average return for April was -1.9% compared with -2.6% in March.
Combined with other recent housing data, today’s Case-Shiller report indicates that the housing market may finally have pulled itself out of the ditch. Unemployment, though still high, has dropped, mortgage rates are at or near record lows, and new home sales are up. It’s yet another instance of an industry that’s been down so long that anything looks like up.