United States: Home prices rise for the fifth month in a row
October 25, 2011
In August, the S&P/Case-Shiller home price composite 20-city unadjusted index increased 0.2% over the previous month, which came in well below the 0.9% rise observed in July and undershot market expectations, which had home prices rising 0.4%. The reading reflects the end of the spring-summer period, which usually sees stronger demand for houses. On year-on-year terms, home prices have dropped 3.8% which, nevertheless, represents an improvement compared to the 4.2% decline tallied in July. In that vein, S&P stated ?that monthly increases in prices had to be paired with improvement in annual rates before anyone could declare that the market might be stabilizing. With 16 out of 20 cities and both Composites seeing their annual rates of change improve in August, we see a modest glimmer of hope with these data.? Furthermore, in an attempt ease pressure on the housing market and boost consumption, the Obama administration has announced a modification to the Home Affordable Refinance Program (HARP), which would allow homeowners that are up to date with their mortgages to refinance their loans without a negative equity limitation.