Published: Wed, June 28, 2017
Worldwide | By Gretchen Simon

Case Shiller: 4% Chicago Area Home Price Gains Kinda Sad

Case Shiller: 4% Chicago Area Home Price Gains Kinda Sad

In New York, home prices rose only 3.8 percent year-over-year, the third weakest pace among 20 major cities measured by Case-Shiller.

Miami home prices rose 5.4 percent in April, year-over-year, the 13th highest increase nationwide, according to the latest S&P CoreLogic Case-Shiller Index. April's result fell short of the 5.9 percent increase forecast in a Reuters poll of economists.

David M. Blitzer, chairman of the index committee at S&P, said in a statement that he's not anxious about another national housing downturn, citing low levels of household debt and mortgage default rates.

Metro Denver remains among the top four major US markets for year-over-year gains in home resale prices, according to the latest S&P/Case-Shiller Home Prices Indices report.

"Since demand is exceeding supply and financing is available, there is nothing right now to keep prices from going up". On a monthly basis, the pace of home price appreciation was downwardly revised by four-tenths to 0.53 percent in March.

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"The increase in real, or inflation-adjusted, home prices in the last three years shows that demand is rising", Blitzer said.

"High demand from home buyers and a limited supply of homes for sale are the main ingredients in the recipe for rising home prices".

Before the seasonal adjustment, the National Index posted a month-over-month gain of 0.9 percent in April, while the 10-City Composite posted a 0.8 percent increase and the 20-City Composite reported a 0.9 percent increase. The title company First American Corp. reported that real home prices actually declined by 1.6 percent in April because mortgage rates dropped slightly.

"The question is not if home prices can climb without any limit; they can't", Blitzer warns. First American's index factors in changes in incomes and mortgage rates. Moreover, mortgage default rates are low and household debt levels are manageable.

Housing market observers have long speculated a looming increase in mortgage rates could slow demand, in turn putting the brakes on home prices. Seattle continued to show the greatest year-over-year gain, up 12.9 percent. Portland's home prices are the second fastest-growing in the country, with year-over-year gains of 9.3 percent in April.

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