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Home Pricing Showing Strength Heading into September

The September data release from ""Clear Capital"":http://www.clearcapital.com/ heralds good news for home pricing around the country. According to the company's Home Data Index (HDI) Market Report, national price improvements observed through the end of summer mark four consecutive months of year-over-year gains.


""Home price trends in August remained positive, posting the fourth consecutive yearly gain,"" said Dr. Alex Villacorta, director of research and analytics at Clear Capital. ""This month, three notable trends shifted: Growth in the fair market segment outpaced the REO segment over the last rolling quarter; through the first half of 2012, REO saturation was on the rise while August saw a drop to the lowest levels since 2008; and non-investor home buyers made up a larger chunk of the sales mix.""

U.S. home pricing rose by 2.9 percent on a year-over-year basis to end August, and Clear Capital noted that the recorded growth ""on this non-seasonally influenced metric shows fundamental


strength fueling gains, rather than a boost from the summer buying season.""

Regionally, the West led the country with a year-over-year advance in home pricing of 7.7 percent, and the area also saw a rise of 1.5 percent month-over-month. The South and the Northeast, meanwhile, experienced year-over-year price gains of 2.5 percent and 1.3 percent respectively.

In the Midwest, home prices rose by a more modest 0.5 percent year-over-year. However, Clear Capital's findings represent the first year-over-year improvement for the region since April of 2010.

Among the top 15 metropolitan statistical areas (MSAs) by performance, all of the markets saw a quarterly rise of 4 percent or more, and seven of the MSAs racked up double-digit year-over-year increases in pricing. The average year-over-year uptick for the highest ranking MSAs was 9.2 percent, while the average quart-to-quarter rise was 6.6 percent.

Commenting on the nation's strongest MSAs, Villacorta stated, ""The shift could certainly have far reaching effects, even on smaller markets like San Bernardino County, where they are considering the use of eminent domain to relieve underwater borrowers. A comparison of price trends in San Bernardino County and Maricopa County, part of the Phoenix MSA, suggests eminent domain may be unnecessary. Phoenix has become the benchmark for recovering markets over the last year, which sheds light on where an organic trajectory of the San Bernardino market could be headed.

""The spark from the investor community has ignited activity in the owner-occupied sector of the market. In other words, historical market forces are at play,"" concluded Villacorta.

About Author: Abby Gregory


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