Home prices are rising slowly but steadily, and some cities are seeing faster gains than others. According to the The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, the U.S. reported a 6.2 percent annual gain in June, down from 6.4 percent in May. While this may be a slower rate of growth, some cities, such as Seattle and Las Vegas reported higher year-over-year gains.
“Home prices continue to rise across the U.S.” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “However, even as home prices keep climbing, we are seeing signs that growth is easing in the housing market. Sales of both new and existing homes are roughly flat over the last six months amidst news stories of an increase in the number of homes for sale in some markets. Rising mortgage rates – 30 year fixed rate mortgages rose from 4% to 4.5% since January – and the rise in home prices are affecting housing affordability.”
Las Vegas saw the greatest price increase in the country, up 13 percent year over year, closely followed by Seattle with a 12.8 percent increase. San Francisco experienced similar growth, with home prices growing by 10.7 percent. Blitzer notes that Las Vegas’s fast growth and improving employment opportunities are key factors in its quick price appreciation.
“The west still leads the rise in home prices with Las Vegas displacing Seattle as the market with the fastest price increase,” says Blitzer. “Population and employment growth often drive homes prices. Las Vegas is among the fastest growing U.S. cities based on both employment and population, with its unemployment rate dropping below the national average in the last year. The northeast and mid-west are seeing smaller home price increases. Washington, Chicago and New York City showed the three slowest annual price gains among the 20 cities covered.”
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