24/7 Wall St.

New home sales recently reached a multimonth high. However. inventory is still tight, which tends to move prices higher. In September prices nationwide rose 3.2% compared with the same month last year. In one large city, they rose much faster.

According to the CoreLogic Case-Schiller Index, which has measured home prices for decades, prices rose 6% in Phoenix in September. They did not rise over 5% in any of the other 20 largest markets.  The Phoenix figure was also well above broader trends. Craig J. Lazzara, Managing Director and Global Head of Index Investment Strategy at S&P Dow Jones Indices, said “September’s report for the U.S. housing market is reassuring.The national composite index rose 3.2% relative to year-ago levels, with smaller increases in our 10- and 20-city composites. Of the 20 cities in the composite, only one (San Francisco) saw a year-over-year price decline in September.”

Home prices in Phoenix have not risen as fast as national prices when the time period of measurement is much longer. Case-Shiller began its measurements in 1980. For comparing long term trends, the index for home prices that year was set at 100. Over the intervening years, home prices nationwide have moved to 212. The Phoenix figure is 197, among the lowest of America’s 20 largest housing markets. By contrast, the fastest growing market over the period is Los Angeles with an index of 287 compared to 1980.

Of course, every city on the list, as well as the national figure, turned down when the housing price bubble burst during The Great Recession. In some markets, which included Las Vegas and some parts of Florida, home prices dropped well over a third. The ongoing growth in home prices has recovered that drop, and some cases the recovery is to pre-recession levels. This has caused some economists to worry another bubble has started to form.

While the Phoenix market is hot now, historically, it is not.

For a nationwide measure of home prices 24/7 Wall St. has done an analysis of what a typical home costs in each of the 50 states.