United States: Home prices continue to rise for third month in a row on seasonal effects
September 27, 2011
In July, the S&P/Case-Shiller home price composite 20-city unadjusted index added 0.9% over the previous month, which came in slightly below the revised 1.2% increase tallied in June (previously reported: +1.1% month-on-month) but, nevertheless, beat market expectations that had prices rising by only 0.6%. As in previous months, the reading partly reflects seasonal factors, as summer often witnesses slightly higher prices. Against a backdrop of declining consumer confidence and sluggish economic activity, however, positive developments in home prices, even if seasonally driven, have surprised the market on the upside. That said, the situation remains gloomy, and S&P stressed that ?while we have now seen four consecutive months of generally increasing prices, we do know that we are still far from a sustained recovery.? Meanwhile, building on the positive monthly reading, home prices are now 4.1% below the level observed in the same month last year, which represents an improvement compared to the 4.4% decline seen in June.