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Shocker! Home Prices Are Up, Says Another Unsurprising Report

Shocker! Home Prices Are Up, Says Another Unsurprising Report

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photo: iStock

 

This will come as no surprise to our most hard-core readers—heck, it won’t surprise even our most casual readers—but home prices are rising, a result of tight inventory and high demand. So why are we telling you this again? Because the Case-Shiller Home Price Index came out on Tuesday, showing that home prices rose 5% across the country from February 2014 to February 2015.

That study of home prices in 20 cities is right in line with an existing-home sales report from the National Association of Realtors®, released in late March, which pegged the price increase at 4.7% year over year as of February. But the Case-Shiller Index also seems to show an acceleration: As of January, prices in the 20 cities had increased by 4.5% year on year.

“Home prices continue to rise and outpace both inflation and wage gains,” said David Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices.

Two of the 20 cities studied by Case-Shiller have surpassed the peak prices of the housing market boom: Denver and Dallas. The rest of the country remains 10% below the highs of 2006, according to the report. “If a complete recovery means new highs all around, we’re not there yet,” said Blitzer.

While Denver and San Francisco showed the largest price increases—about 10% year on year—San Diego, Las Vegas, and Portland showed signs of a slowdown. Las Vegas home prices had tumbled more than any other city during the housing market collapse, nearly a 62% drop in value. According to Case-Shiller, they’re now 41% below that peak.

“The higher prices should lead to less underwater owners and more inventory from both new construction and existing sellers in future months,” said Jonathan Smoke, chief economist of realtor.com®.

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