S&P Home Price Indices Hits Record for 6th Straight Month

Standard & Poor’s, New York, reported its CoreLogic Case-Shiller National Home Price Indices set a sixth consecutive monthly record as home prices continued to rise at an elevated pace.

The report said the National Home Price NSA Index, covering all nine U.S. census divisions, reported a 5.6% annual gain in May, unchanged from April. The 10-City Composite annual increase came in at 4.9%, down from 5.0% the previous month. The 20-City Composite posted a 5.7% year-over-year gain, down from 5.8% in April.

Seattle, Portland, and Denver reported the highest year-over-year gains among the 20 cities. In May, Seattle led the way with a 13.3% year-over-year price increase, followed by Portland with 8.9%, and Denver overtaking Dallas with a 7.9% increase. Nine cities reported greater price increases in the year ending May from a month ago.

Before seasonal adjustment, the National Index posted a month-over-month gain of 1.0% in May. The 10-City Composite posted a 0.7% increase and 20-City Composite reported a 0.8% increase in May. After seasonal adjustment, the National Index recorded a 0.2% month-over-month increase. The 10-City Composite remained stagnant with no month-over-month increase. The 20-City Composite posted a 0.1% month-over-month increase. All 20 cities reported increases in May before seasonal adjustment; after seasonal adjustment, 14 cities saw prices rise.

“Home prices continue to climb and outpace both inflation and wages,” said David Blitzer, Managing Director and Chairman of the Index Committee with S&P Dow Jones Indices. “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.”

The report said as of May, average home prices for the MSAs within the 10-City and 20-City Composites are back to their winter 2007 levels.