U.S. home prices increased 0.7% on an unadjusted basis in July compared with June and increased 5.1% compared with July 2015, according to the S&P CoreLogic Case-Shiller Indices.
That brought home prices to within 0.6% of the record high set in July 2006.
The 10-city composite saw home prices rise 0.5% compared with June and 4.2% compared with July 2015. The 20-city composite saw prices rise 0.6% compared with June and increase 5.0% compared with July 2015.
After seasonal adjustment, home prices increased 0.4% month over month. The 10-city composite posted a 0.1% decrease, while the 20-city composite was unchanged compared with June.
After seasonal adjustment, 12 cities saw prices rise, two cities were unchanged, and six cities experienced negative monthly price changes.
Portland, Ore.; Seattle; and Denver reported the highest year-over-year gains among the 20 cities. Portland led the way with a 12.4% year-over-year price increase, followed by Seattle at 11.2% and Denver at 9.4%.
Nine cities reported greater price increases in the year ended July versus the year ended June.
“Both the housing sector and the economy continue to expand, with home prices continuing to rise at about a five percent annual rate,” said David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices. “The statement issued last week by the Fed after its policy meeting confirms the central bank’s view that the economy will see further gains.
“Most analysts now expect the Fed to raise interest rates in December,” he added. “After such Fed action, mortgage rates would still be at historically low levels.”
Blitzer noted, “Currently, outstanding mortgage debt on one-to-four family homes is 12.6 percent below the peak seen in the first quarter of 2008 and up less than two percent in the last four quarters. There is no reason to fear that another massive collapse is around the corner.”