Published: Fri, December 02, 2016
Economy | By Melissa Porter

US Home Prices Surpass Pre-Recession Peak Amid Healthy Sales

US Home Prices Surpass Pre-Recession Peak Amid Healthy Sales

The latest S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index recording a new peak in September, besting the level set two months earlier: The National index reported a 5.5 percent annual gain in September, up from 5.1 percent in the previous month.

The S&P Case-Shiller index of USA home prices rose in September to the highest level since July 2006, when the most recent housing boom topped out. The milestone comes after more than four years of steady gains. The country is building far fewer homes than normal, the homeownership rate is near a five-decade low, and mortgages remain hard to come by, especially for less-affluent buyers.

Home prices finally surpassed all-time highs set in July 2006 as the housing boom topped out.

Among the major metro markets, Seattle and Portland experienced the greatest year-over-year price increases with 11 percent and 10.9 percent spikes, respectively.

Although growth in San Diego is slowing, home prices remain among the highest nationwide.

The group's national index climbed 5.5% from a year ago, up from 5.1% annual growth the prior month.

Robert Shiller, an economist at Yale University, says homepwmers who were "underwater" - they owed more on their homes than they were worth - are now ahead of the game.

The FHA First-Time Buyer NMRI came in at 24.8% in July, up 1.0 percentage point from a year earlier, setting a series high.

While prices have recovered, the market is flashing caution signs. She also said that buyers, especially young buyers, are still out there in droves despite the strong headwinds.

The average national home price is now 0.1% above the June 2006 price, although the index does not account for inflation.

After seasonal adjustment, the 10-city composite posted a 0.2% month-over-month increase while the 20-city composite reported a 0.4% month-over-month increase.

Although prices have bounced back, many economists tempered their enthusiasm about what it means for the housing market's overall health. Zillow's home-price index, which covers a wider range of markets, is still 2.7% below the peak.

After seasonal adjustment, the national index rose 0.8% month-over-month, the 10-city index reported a 0.2% increase and the 20-City index rose 0.4% month-over month.

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