Skip to comments.Home prices climb in December, best yearly gain since 2006 (Price rise expected to persist in 2013)
Posted on 02/26/2013 6:59:13 AM PST by SeekAndFind
NEW YORK (Reuters) - U.S. home prices picked up in December, closing out 2012 with the biggest yearly gain in more than six years as the housing market got back on its feet, a closely watched survey showed on Tuesday.
The S&P/Case Shiller composite index of 20 metropolitan areas rose 0.9 percent in December on a seasonally adjusted basis, topping expectations for a gain of 0.5 percent.
Prices in the 20 cities jumped 6.8 percent year-over-year, ahead of expectations for 6.6 percent and the best yearly gain since July 2006.
"I expect the home price rise to persist in 2013," said Michelle Meyer, senior economist at Bank Of America Merrill Lynch in New York.
For the final quarter of the year, prices gained 2 percent on a seasonally adjusted basis. On a non-adjusted basis, prices were up 0.2 percent in December.
Last year housing contributed to economic growth for the first time since 2005 as the sector began to recover from its far-reaching collapse. Still, the market is far from fully healed, with over 20 percent of mortgages underwater and foreclosure rates still elevated.
Prices have been rising since last February as the supply of available homes for sale tightened in 2012, helping to stabilize home values. Investors buying cheap homes to be converted into rentals also supported the market and some hard-hit areas saw a sharp bounce back in prices.
Phoenix, for example, saw gains of 23 percent compared to December 2011.
(Excerpt) Read more at finance.yahoo.com ...
...with hot federal money.
60-70% of Miami sales are to foreigners looking to park cash safely away from their socialist masters. 90% of those deals are all cash.
Credit is tight here in Chicago.
Did not know that.
I`ve been keeping an eye on LV and the vast majority is private institutions scooping up foreclosures and immediately re-listing for 50 - 100% more than the purchase price. It`s pure speculation out there right now. An attempt to try make it look like individuals are buying hoping you take the bait and hand the real estate holders huge profits off their flip.
Manipulating public perception is SOP and bankers along with the FED have a vested interest in doing so. That said, I’d hate to miss a bargain.
Keep in mind this rule of thumb:
a 1% increase in interest rates equals about a 10% drop in price to maintain the same monthly payment.
So are you buying the price or the payment?
We’re not likely to see 3% mortgages again in our lifetimes. But, if interest rates rise will your value drop?
That’s the problem the FED faces and the fundamental issue in manipulating the economy with ZIRP.
I just counted this morning, there are now 8 houses for sale on my immediate block and most of those have been for sale for months.
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