- Denver, San Francisco showed biggest gains in 20-city gauge
- Prices nationwide rose 4.5% in the 12 months ended in June
Home prices in 20 U.S. cities climbed 5 percent in June from the same month a year earlier, a sign of more progress in the housing market.
The increase in the S&P/Case-Shiller index of property values matched the year-over-year gains in the prior three months, the group said Tuesday in New York. The median estimate of economists surveyed by Bloomberg called for a 5.1 percent year-over-year advance. Nationally, prices rose 4.5 percent.
Stronger demand that began during the spring selling season and a limited number of available properties have helped prop up real-estate prices. Increased construction, along with persistent job growth, rising rents and easier lending standards, would help lure more prospective buyers and extend the recent advance.
“Demand is still outstripping supply, so we’re likely to see a continuation of modest upside pressures on home prices,” Russell Price, senior economist at Ameriprise Financial Inc. in Detroit, said before the report. “We would be seeing much more significant home price appreciation if it weren’t for the fact that mortgage qualifications are still very stringent.”
Economists’ estimates in the Bloomberg survey ranged from year-over-year gains of 4.1 percent to 5.5 percent. The S&P/Case-Shiller index is based on a three-month average, which means the June figure also was influenced by transactions in May and April.
Home prices in the 20-city index adjusted for seasonal variations eased 0.1 percent in June from the prior month. They were also down 0.1 percent in May. The Bloomberg survey median called for a 0.1 percent advance.
All 20 cities in the index showed a year-over-year gain, led by a 10.2 percent increase in Denver. Property values climbed 9.5 percent in San Francisco and 8.2 percent in Dallas.
“The price gains have been consistent as the unemployment rate declined with steady inflation and an unchanged Fed policy,” David Blitzer, chairman of the S&P index committee, said in a statement.
The price increases accelerated in 11 cities in June from the same time in 2014, compared with the 12 months ended in May. Phoenix and Detroit had the longest streaks of year-over-year gains.
The year-over-year gauge, based on records dating back to 2001, provides better indications of trends in prices, the group has said. The panel includes Karl Case and Robert Shiller, the economists who created the index.
Measured against a month earlier, property prices rose in nine of 20 cities in June and were unchanged in two, according to the seasonally adjusted data. Home values in Portland, up 0.5 percent, showed the largest monthly gain, while Chicago registered the biggest decline -- down 1.7 percent.