United States: House price growth steady in March as sequential data points upwards
May 30, 2017
House prices in the U.S. continued to head higher in March, buttressed by a robust labor market and scarce housing availability. The S&P/Case-Shiller 20-city home composite index rose a noteworthy 1.0% in March from the previous month, an eleven-month high and well above February’s 0.4% increase. When adjusted for seasonal factors, home prices rose a slightly smaller 0.9% from the previous month, which was above the 0.7% increase seen in February and market expectations of a 0.8% increase.
On a year-on-year basis, home prices continued to climb across the board in March, with previously lagging cities now reporting stronger price increases. Home price growth was unchanged in March at February’s 5.9%, which was the largest expansion since July 2014. S&P said that Seattle, Portland and Dallas, in that order, continued to report the strongest increases in prices of the 20 cities included in the index. The city that saw the smallest expansion was once again New York, though prices there still grew by 4.1% in May—nearly double the rate of inflation.
The housing sector is becoming one of the focal points of this year’s stronger economic performance. Indeed, sales of both new and existing homes, housing starts and the National Association of Home Builders’ sentiment index are all trending higher, with prices likely to follow through.
Author: David Ampudia, Economist