Home prices remain on the rise

U.S. home prices remain on the upswing at the start of 2014, as a slow recovery from the bust that led to the financial crisis continues.

In the first three months, prices rose 10.3% on an annual basis, according to the S&P/Case-Shiller report. In March, an index of 20 large housing markets gained 12.4% year-over-year.

The year-over-year gains are likely to moderate, according to Stan Humphries, chief economist for Zillow, because current prices are being compared with months when many markets were at or near their post-bust bottoms. Coming comparisons will be against less depressed prices.

There are several other factors that continue to boost prices, however, including unusually low mortgage rates and the diminishing number of foreclosures and short sales on the market, which tend to sell for less. Those factors will take time to disappear.

“We’re still several years away from a housing market driven purely by fundamentals like income growth and rising household formations,” said Humphries.

Prices remain about 18% below their peak, which was reached in the summer of 2006.

Trends in the housing market have been mixed, with a bounce back for housing starts in April and better new home sales. Buyers have been able to take advantage of very low mortgage interest rates, but tight loan underwriting still keeps many potential homebuyers out of the market.

Even though price gains have moderated, all the cities in the 20-city index recorded gains year over year, led by Las Vegas at 21.2%. Prices in San Francisco, San Diego and Los Angeles also rose faster than average.

On a monthly basis, New York was the only city with a decline in March.

The price increases will have a positive impact on mortgage borrowers, according to Bill Banfield, Quicken Loans vice president.

“While the increase in home prices is slowing, homeowners have still gained a significant amount of equity in the last year, ” he said.

That will push some of the 9 million borrowers who are still underwater on their loans, owing more than their homes are worth, above water for the first time in years. That will make them less likely to lose their homes to foreclosure and help stabilize prices.

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About thenoelteam

As a Broker with RE/MAX Alliance, I work energetically for my clients whether they are a buyer or seller. I help you achieve your goal of owning a home or getting the best price for your home in the shortest time possible. After graduating from UCLA with a degree in communications and finance, I was licensed in 1977 and since then I have sold over 3600 properties amounting to over $1 billion in sales. I currently rank in the top 10 in home sales for Colorado. I offer the same quality of service and superior communication to all clients, ranging from starter homes to multi-million dollar estates, commercial and income properties, relocations and foreclosures My goal is to provide you with the best representation possible whether you are buying or selling. Over the years, one of the things that I've discovered is that there is a difference in the way individual Realtors do business. For me, I have always felt that honesty and personal integrity are the foundations upon which a successful business and career are built and sustained. I have an extensive background and knowledge base in real estate, including financing, which has enabled me to provide outstanding, quality advice and service not found with many agents today. My commitment to communication creates a positive relationship between my client and myself that results in a successful property sale or purchase. My passion for real estate, commitment to my clients and personal integrity has helped me to achieve success placing me in the top 1% of all brokers in nationwide. In my career, I have earned a number of awards and received considerable recognition for my success but the most significant recognition comes from the fact that over 75% of my business comes from past clients. My success is a true measure of my client satisfaction.
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