The upward trend in U.S. home prices is showing no sign of slowing, with the latest S&P Core Logic Case-Shiller U.S. National Home Price Index recording a 5.6% annual increase in November compared to 5.5% in October.
Seattle (10.4%), Portland (10.1) and Denver (8.7%) again saw the largest annualized price increases for the month, while a total of eight cities saw larger year-over-year price growth in November than in October.
A sub-index of 20 major U.S. metros posted a 5.3% year-over-year rise compared to 5.1% in October, coming in ahead of analyst expectations, according to CNBC.
The consistent price growth without an apparent bubble signifies recovery from the last boom-and-bust cycle, David Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices, said in a release. He noted that the price gains continue to be offset by still-low interest rates, employment growth and increases in disposable income.
Still, the recent upward trend in mortgage rates along with tight inventory and a shortage of skilled labor threaten to moderate growth in housing activity this year.
Blitzer noted that demand for housing could continue to benefit from increases in personal income and employment among potential buyers, and that the Trump administration’s pledges for tax reform and infrastructure investment could bolster economic activity, which may also contribute to higher mortgage interest rates.
Other recent data tallies with the latest S&P/Case-Shiller figures. Black Knight Financial Services reported this week that home prices jumped 1.1% from October to November, putting them up 5.7% since the start of 2016 and just 0.3% off the market’s peak in June 2006.
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