Economy Watch: Zillow Reports Home-Price Growth

By Dees Stribling, Contributing Editor

Residential market indices are legion, and these days most of them are pointing toward a steady, if not overheated, U.S. housing recovery in most markets. On Tuesday, Zillow Inc. added its latest findings, which were that nationwide home prices were up 1.3 percent in the third quarter of 2012, the largest quarterly increase since 2006, just before the housing bubble popped.

Greater Phoenix, one of the main casualties of the bubble, saw the largest quarter-over-quarter increase during 3Q12, at least among the 30 largest metro areas in the country, gaining 5.9 percent, according to Zillow. Las Vegas, another long-suffering housing market, recorded a 3.9 percent quarterly uptick, and Denver wasn’t far behind at 3.8 percent.

But the housing recovery is uneven. That was demonstrated by Zillow’s finding that values in some metro markets are still declining. Prime example: the Atlanta area, which experienced a 2.2 percent drop during the third quarter. Other metro-area value losers were New York, St. Louis, Cleveland and Philadelphia.

Philly Fed reports growth in most states

The Federal Reserve Bank of Philadelphia said on Tuesday that the coincident indexes that it calculates improved during September for a majority of the 50 states. The indexes, which combine four state-level indicators to summarize current economic conditions in a single statistic, increased in 39 states, decreased in only five and remained stable in six.

During the third quarter of the year, the pattern was similar. The indexes increased in 37 states, decreased in 11 states, and remained stable in two states. For comparison purposes, the Philadelphia Fed also developed a similar coincident index for the entire United States, which rose 0.2 percent in September and 0.6 percent over the past three months.

Along with the coincident indexes, the Philly Fed publishes a map of the states, with up indexes in green, down indexes in red. The greenest of the green states (denoting largest increases in their index) are the energy-boom states (North Dakota, Montana and Idaho), along with California and South Carolina, while the reddest of the red states (denoting the largest decreases in their indexes) were Michigan and West Virginia.

Gas prices slide

Gas prices are on a steady downward course, according to the latest estimate by AAA. As of Tuesday the average price for a gallon of regular gas nationwide was $3.648, down from $3.773 on the same day last week, the organization said. A month ago, the price was $3.814 per gallon. Though the trend is in the right direction as far as the driving public is concerned, so far this week’s average is still higher than a year ago, when a gallon of regular averaged $3.456.

Wall Street swung low again on Tuesday, roughly mirroring last Friday, with the Dow Jones Industrial Average losing 243.36 points, or 1.82 percent, mostly spurred by various poor 3Q earnings reports. The S&P 500 declined 1.44 percent, but the Nasdaq was down by only 0.88 percent.