Home Prices Rebound to 2003 Levels
By Zoe Eisenberg
More great market news came through yesterday: According to S&P/Case-Shiller, in July, the average home price rose to the same level as those seen during summer 2003, when the housing boom first started its journey toward the 2006 peak. While this may not signify that we are currently standing on the cusp of a market boom, it does show a significant turnaround, and perhaps hints at a definite end to real estate’s bleak streak.
The recent S&P/Case-Shiller national home price index showed that in July, prices increased by 1.5 percent for the 10-City Composite and by 1.6 percent for the 20-City Composite.
This improvement marks the third straight month that prices rose in all 20 major markets followed by the index–which covers more than 80 percent of the US housing market. Additionally, numbers show that if not for a .06 decline in Detroit in April, there would have been a four month improvement streak.
When compared to a year earlier, the index proved to be up 1.2 percent, an improvement from the year-over-year change reported for June. This marked the first month that prices were higher than they were the previous year.
“The news on home prices in this report confirm recent good news about housing,” said David Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, in a recent release.
“Single family housing starts are well ahead of last year’s pace, existing home sales are up, the inventory of homes for sale is down and foreclosure activity is slowing. All in all, we are more optimistic about housing. Upbeat trends continue. For the third time in a row, all 20 cities and both Composites had monthly gains. Stronger housing numbers are a positive factor for other measures including consumer confidence.”
Real estate professionals located outside of the top metros are seeing movement inside their markets, too.
“We’ve been seeing a strengthening market for some time now but August sales are evidence of a major turning point,” says Jamie Moore, president of the Rhode Island Association of REALTORS®. “We may still experience a step or two backward in the months ahead but the forward momentum has clearly become more evident. The market is much stronger than it has been.”
And Dorothy Martwick, Broker/Owner of a real estate company in Minot, N.D., comments on her unique market, which never saw much of a real estate recession due to the oil boom in western N.D. and their proximity to the Minot Air Force Base.
“My opinion of the future of real estate here in Western N.D. is that the market will level off and stabilize in the near future and, depending on the national election results and the oil pipeline, capabilities may either stay level or boom again next year and for the next several years. “
“Overall, we’re thrilled to see hard evidence that the market is recovering. Great pricing and low interest rates have really helped turn things around,” says Rhode Island’s Moore.
To view the complete home price index, click here.