case schiller home price index housing market real estate sales interest rates
Nick Ut/AP
By Leah Schnurr

NEW YORK -- U.S. single-family home prices rose in May, suggesting the housing market recovery continued during the spring buying season though the pace of gains cooled compared to the month before, a closely watched survey showed on Tuesday.

The S&P/Case Shiller composite index of 20 metropolitan areas gained 1 percent on a seasonally adjusted basis, shy of economists' forecast for a 1.5 percent increase. That marked a slower pace than April's 1.7 percent rise.

On a non-adjusted basis, prices rose 2.4 percent.

Compared to last May, prices also fell short of expectations, rising 12.2 percent from a year earlier. Still, it was the biggest annual gain since March 2006, matching a record set in April.

The report was unlikely to alter economists' views that the housing sector's recovery is progressing, making it a bright spot for the economy. The dollar erased losses against the yen, but beyond that, financial markets saw little reaction to the data.

All 20 cities rose on a yearly basis, led by a 24.5 percent surge in San Francisco. Two cities -- Dallas and Denver -- reached record levels, surpassing their peaks reached during the housing boom. It was the first time any city has racked up a new all-time high, the survey said.

"Home prices continue to strengthen," David Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.

"The overall report points to some shifts among various markets: Washington, D.C., is no longer the standout leader and the eastern Sunbelt cities, Miami and Tampa, are lagging behind their western counterparts."

A tightening of inventory available for sale, fewer foreclosures and buying from investors has helped push prices higher during the past year-and-a-half as the battered housing sector has gotten back on its feet.

But a potential hurdle has emerged recently in the form of higher mortgage rates, as borrowing costs have risen in the wake of the Federal Reserve's plan to start winding down its economic stimulus later this year if the economy progresses as expected.

Still, rates remain low by historical standards and most economists don't expect them to derail the housing market.

May's home price data likely didn't capture the rise in rates as the contracts to purchase would have been signed before rates began increasing, Bank of America-Merrill Lynch wrote last week.

Increase your money and finance knowledge from home

What is Inflation?

Why do prices go up?

View Course »

Building Credit from Scratch

Start building

View Course »

Add a Comment

*0 / 3000 Character Maximum


Filter by:
The Paterfamilia

They are reporting about May in August because the FOOL Bernecke Flailed his arms like Chicken Little as a sign to his greedy Banksters who actually own the Federal Reserve which they Founded as a CORRUPT Corpoorate Agency that only they can own the stock holdings...

Since they force him into what other Wall Street Investors go to jail for called Insider Traders thru a huge conflict of interest for informing them about his plans to Taper printing more Dollars that they just set on the side with their other Trillions that only reduce the value of the money "We The People" have actually worked and saved for their deposits...

It sucks that the Government is set up where Banks get Zero Interest, can print their own Money to bail themselves out and if that's not enough gamble it away... While at a time when Home Owners barely make back 10 or 12% of the 35% devaluation the banks saddled them with for repackaging high risk loans and misrepresented them as Low Risk ones to rip off Retirement Investors...

Now they have already killed this years market by in the month they don't report about here they rushed to raise almost a 1.5% APR increase that has the impact of a 13% per month increase per 1% raise in rates... That's a take away of almost 20% on the Buyers bottom line not ncluding their loss of another 7% to the Real Estate Agents fees.. No first time buyers can manage that at the same time, AGAIN the GREEDY BANKS have doubled Student Loan APR's too.. NOTHING IS ENOUGH FOR THESE FREE LOADER Middlemen, the Real Estate Agents are working too against sellers to lower and give back some of their gains which really have ate up already by the banks APR increases...

What's even worst is the knowledge that Bernenke recanted his position, the Banks will never see a dime increase and whatever little does get sold will be another huge windfall for these overly Corrupt Loan Sharks... All the while the Banks are getting a Prime Rate of ZERO PERCENT ANYWAY... THIEVES... Now they want to shut dow Fannie and Freddy, which really took away what little risk Banks really carried and opened doors for first time buyers that drive the market... TRILLIONS SET ON THE SIDE LINES not being used forcing more Foreclosures and degrading markets for the Greedy Venture Capitalists, who are being again set up for easy windfalls... What a mess this Industry is causing for Future Humanity!!!

No listings are coming in and no sold homes are going out, because nothing is enough to satisfy their GREED...

August 06 2013 at 12:18 AM Report abuse +1 rate up rate down Reply

A report from May 30th and today is July 30th. What happened in the last 60 days?

July 30 2013 at 12:06 PM Report abuse rate up rate down Reply

I see another Housing Bubble looking for a Pin. That pin will come along soon. Propoerty Investors buying up Foreclosures for rental purposes will be among the main culprits that pop the bubble this time since Many of these investors will be defaulting by years end. That is the price you pay for trying to put the recovery on Steroids and not letting the economy breath on its own in a natural way. I do blame the Fed for this

July 30 2013 at 10:06 AM Report abuse +1 rate up rate down Reply
1 reply to erink91321's comment

There will be no mass default this time. These investors are buying houses with their own money. Here in Los Angeles 28.7% of all homes sold are to all cash investors. I do not see a repeat of 2007.

July 30 2013 at 10:29 AM Report abuse rate up rate down Reply