May Home Prices Continue Strong: Case-Shiller

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The S&P CoreLogic Case-Shiller national home price index rose to a sixth consecutive record high in May, up 5.6% to 190.61. The month-over-month percentage increase was the same as the April rise.

In all 20 U.S. cities included in the 20-city home price index, May house prices increased year over year. and all 20 also posted non-seasonally adjusted (NSA) month-over-month increases. Seattle (up 13.3%), Portland (up 8.9%) and Denver (up 7.9%) posted the largest year-over-year gains. Portland and Las Vegas (up 1.3%) posted the largest month-over-month increase, while New York (up 0.1%) posted the smallest gain.

The S&P CoreLogic Case-Shiller NSA home price indexes for May increased by 5.7% year over year for the 20-city composite index and by 4.9% for the 10-city composite index.

Economists had estimated an NSA year-over-year gain in the 20-city index of 5.8%. The NSA monthly gain of 0.8% came in right at the estimate.

The index tracks prices on a three-month rolling average. May represents the three-month average of March, April and May prices.

Average home prices for May remain comparable to their levels in the winter of 2007.

The chairman of the S&P index committee, David M. Blitzer, said:

Home prices continue to climb and outpace both inflation and wages. Housing is not repeating the bubble period of 2000-2006: price increases vary across the country unlike the earlier period when rising prices were almost universal; the number of homes sold annually is 20% less today than in the earlier period and the months’ supply is declining, not surging. The small supply of homes for sale, at only about four months’ worth, is one cause of rising prices. New home construction, higher than during the recession but still low, is another factor in rising prices.

Compared with their peak in the summer of 2006, home prices on both 10-city and 20-city indexes remain down about 6.2% and 3.7%, respectively. Since the low of March 2012, home prices are up 45.0% and 48.4% on the 10-city and 20-city indexes, respectively. On the national index, home prices are now 3.2% above the July 2006 peak and 42.2% higher than their low-point in February 2012.