Economy Watch: Home Price Increase Healthy, Says Case-Shiller
By Dees Stribling, Contributing Editor
The S&P/Case-Shiller Home Price Indices, which were released on Tuesday, said that average home prices were up 7.3 percent for the 10-city composite and 8.1 percent for the 20-city composite in the 12 months ending in January 2013. Those are rates that haven’t been for a while now—since before the housing crash, in fact.
“The two headline composites posted their highest year-over-year increases since summer 2006,” David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, noted in a press statement. “This marks the highest increase since the housing bubble burst.”
In January, nine cities—Atlanta, Charlotte, Las Vegas, Los Angeles, Miami, New York, Phoenix, San Francisco and Tampa—posted positive monthly returns as well as annual increase. So did and both composites, month-over-month. Dallas was the only MSA where the level monthly remained flat, but it has been relatively unscathed by the aftermath of the housing crash, and didn’t have as far to climb back.
New home sales see downtick in February
New home starts were at an annualized rate of 411,000 units in February, according to the Census Bureau on Tuesday. That’s down from the January, when the total was 431,000 units.
Though the total was down for the month, most estimates for 2013 are still healthier than in recent years. NAHB, for instance, thinks that 447,000 units will be built (both single-family and multifamily), while Fannie Mae is a bit more optimistic at 452,000 units, and Moody’s Analytics puts the number at 500,000 units.
The bureau also reported that the estimated supply of new houses for sale at the end of February was 152,000. That’s a supply of 4.4 months at the current sales rate. The bureau’s definition of for sales is when a permit to build has been issue in permit-issuing places or work has begun on the footings or foundation in non-permit areas, but a sales contract hasn’t been inked.
More durable goods sold in February
The Census Bureau also reported that new orders for durable goods were up 5.7 percent in February compared with January. Orders have been up on a month-over-month basis for five out of the last six months, dropping only in January. Transportation equipment spurred most of the increase, rising over 20 percent for the month.
Wall Street had another up day on Tuesday—there’s been a fair run of those lately—with the Dow Jones Industrial Average gaining 111.9 points, or 0.77 percent. The S&P 500 was up 0.78 percent, while the Nasdaq advanced 0.53 percent.