U.S. Home Prices Climbed 5.7% in First Quarter From Prior Year

[Purveyor]

Source: Bloomberg

May 25, 2016 — 9:20 AM EDT

U.S. home prices rose 5.7 percent in the first quarter from a year earlier as buyers competed for a limited supply of listings.

Prices climbed 1.3 percent on a seasonally adjusted basis from the previous three months, the 19th consecutive quarterly gain, the Federal Housing Finance Agency said in a report Wednesday from Washington.

Home prices have risen as job growth brings out more buyers in a market starved for choices. There were 1.98 million houses for sale at the end of March, down 1.5 percent from the same month last year, according to the National Association of Realtors. While the U.S. has a whole had robust gains, prices fell from the previous quarter in 12 states and the District of Columbia, the FHFA said.

“Home price appreciation was somewhat less widespread than in recent quarters,” Andrew Leventis, FHFA’s supervisory economist, said in a statement. While price drops were modest, “such declines are notable given the pervasive and extraordinary appreciation we have been observing for many years.”

Read more: http://www.bloomberg.com/news/articles/2016-05-25/u-s-home-prices-climbed-5-7-in-first-quarter-from-prior-year

[silvershadow]

1. If there are any homeowners left in America, this is good news for them. nt

[whatthehey]

3. 63.5% of us

But I'm sure DU doomers think we're all 1%ers even so...

http://www.census.gov/housing/hvs/files/currenthvspress.pdf

Something else interesting from last report. Median rental for vacant units is $870. Median sale price for offered units is $144,700.

Average effective property tax rate is about 1%.

I used average insurance numbers from my last homes in 3 different states, even though they were all a bit above median.

The end result? With ZERO down, paying over the current prevailing 30 year rate, you can buy the median sale unit more cheaply (855 including PITI) than renting the median rental unit, even though the former is superior (while many nice places are available for rent, there are far fewer low end multi-family apartments available for sale, skewing the sale inventory to a higher level than the rental inventory. Buying the equivalent property would be much cheaper). Then you have to add in tax benefits, equity building etc.

To illustrate, I checked what $850-70 would rent and buy in the last area I visited.

You can rent this in 1+ BR 1BA upper Duplex in Myrtle Beach
https://myrtlebeach.craigslist.org/apa/5599918525.html

Or buy this 3BR/2BA single family home there for probably less...
https://myrtlebeach.craigslist.org/reb/5560784229.html

[silvershadow]

5. They stole mine. Flat out stole it. nt

[whatthehey]

6. Who are they and how was it stolen?

[silvershadow]

7. I have written tomes about it. Trust me. They stole it. nt

[whatthehey]

11. mmmmkay. I have seen it happen, but not often at all.

Don't know your situation but stealing a home, with the heavily regulated tracking of title and title insurance, conveyancing and all that is kinda tricky. It's not like a bicycle that is untraceable or even a car that can be chopped. There's a pretty major incentive for the government to know who owns houses. Foreclosing on homes that aren't being paid for is not all that rare albeit rarer than some think, running about 1 per 1300 these days, but if I'd leant somebody six figures-plus and they weren't paying me back I'd want to reclaim some of it legally too. False foreclosures on people who are paying or have even paid up are certainly not unknown, but there are 40 million-plus mortgages out there so paperwork screwups are going to happen. Surely a massive embuggerance for those few homeowners, but the courts exist for a reason.

[LibDemAlways]

2. I suppose this is good news for sellers. Bad news for buyers as

more and more are priced out of the market. Have no idea where the money is coming from to pay close to $700K for an old tract house fixer in my corner of So. Cal. It's outrageous.

[whatthehey]

13. Anybody who could buy and chose not to in the last 7 years shot themselves in the foot.

Record low mortgage rates and massively collapsed prices meant buying was much cheaper than renting outside a few overheated exceptions a la SF or NYC.

Sure plenty of folks don't have the credit rating or the income to buy, but for that demographic sales prices are irrelevant and rental prices are the key to watch.

[Stallion]

14. No Kidding-Home Prices in DFW Area Are Up About 70% in that Period

that's how most middle-class Americans build life-time wealth

[6chars]

15. i.e. transfer to the old of the future earnings of the young

not the first time.

[WhiteHat]

4. This is NOT good.

Not for Americans who feel they should WORK for a living.

Q: When was the last time average Americans got a raise to match the increase in housing prices? Ans: 1990.

[whatthehey]

8. So the 2/3 who own houses are all the idle rich? Cool.

[glinda]

10. New way to suck money from the vanishing middle Class.

Buy up properties and charge huge rents in some cities..

[whatthehey]

12. Ermmm... how does 63.5% owning their own home become a rental question exactly?

Anybody renting anything out is renting them to the other 36.5%

You could say mortgages are a sort of rent I guess, but that's a pretty big stretch, and still leaves over 1/3 of owner occupied who are free and clear owners.

[phleshdef]

9. Its good for me, my house was worth less than my loan there for awhile.

Now I'm breaking even again. I'm as middle class as it gets.