Christopher S. Rugaber
WASHINGTON: Home prices rose in nearly all major U.S. cities in April from March, further evidence that the housing market is slowly improving even while the job market slumps.
The Standard & Poorís/Case-Shiller home price index showed increases in 19 of the 20 cities tracked. Thatís the second straight month that prices have risen in a majority of U.S. cities.
And a measure of national prices rose 1.3 percent in April from March, the first increase in seven months.
Cleveland-area home prices rose 2.3 points from March to April, putting the regional index at 96.85. Still, home prices in the Cleveland metro area were down 1.3 percent since Jan. 1.
The Cleveland metro index remained below its January 2000 base setting of 100.
San Francisco, Washington and Phoenix posted the biggest increases. Prices fell 3.6 percent in Detroit, the only city to record a drop.
The month-to-month prices arenít adjusted for seasonal factors. Still, prices in half of the cities are up over the past 12 months.
Prices are increasing as other parts of the housing market are strengthening. Sales of new and previously occupied homes are up over the past year, in part because mortgage rates have plunged to the lowest levels on record. Builders are more confident and are starting to work on more homes.
The S&P/Case-Shiller monthly index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The April figures are the latest available.
Its measure of home prices for all 20 cities fell 1.9 percent over the 12 months ending in April. That suggests weaker markets continue to weigh on national prices.
But other measures show home prices have risen nationally over the past year. CoreLogic, a private firm, calculates that prices rose 1.1 percent nationally in the 12 months ending in May. Federal Housing Finance Agency, which oversees mortgage giants Fannie Mae and Freddie Mac, says prices have increased 3 percent in the 12 months ending in April.
Recent data indicate that the housing market has started to recover more than five years after the bubble burst.
Greater interest from buyers is boosting buildersí confidence. In May, builders requested the highest number of permits to build homes and apartments in 3Ĺ years.
The supply of homes for sale remains extremely low, which has helped stabilized prices. The inventory of previously occupied homes is back down to levels last seen in 2006. And there were 145,000 new homes for sale in May. Thatís only slightly higher than in April, which was the lowest supply on records dating to 1963.
Despite the modest gains in housing, the broader economy has weakened in recent months. Employers have added an average of only 73,000 jobs a month in April and May. Thatís much lower than the average of 226,000 added in the first three months of this year. Some economists worry that the sluggish job market could weigh on home sales just as the housing market is flashing signs of recovery.
Beacon Journal business writer Jim Mackinnon contributed to this report.