Lower home prices, record low mortgage rates, high rents, and a slowly recovering economy have been drawing some buyers back to the housing market.
U.S. home prices rose during September from a month earlier, strengthening indications of a housing-market recovery, according to Standard & Poor’s Case-Shiller home-price indexes.
For the third quarter, U.S. home prices also continued to show improvement, up 3.6 percent from a year earlier and up 2.2 percent from the second quarter.
During September, the Case-Shiller index of 10 major metropolitan areas and the 20-city index rose 0.3 percent from August — the sixth consecutive month of growth. When adjusted for seasonal factors, the gains were 0.3 and 0.4 percent, respectively.
On a year-to-year basis, the 10-city index was up 2.1 percent, and the 20-city index improved 3 percent.
Lower home prices, record low mortgage rates, high rents, and a slowly recovering economy have been drawing some buyers back to the housing market; furthermore, the number of distressed homes for sale — such as foreclosures and bank sales that tend to bring down prices — also has been waning.
Despite the progress, the indexes remain off roughly 29 percent from their June/July 2006 peaks.
Seventeen cities reported rises in home prices last month. Markets that were hit hardest by the housing bust have been among those seeing the strongest improvement lately. Phoenix home prices jumped 20 percent during September from a year earlier.
Atlanta home prices turned up 0.1 percent following 26 months of decline. Chicago and New York posted the only year-to-year declines, down 1.5 percent and 2.3 percent, respectively.
Though closely followed by economists and the markets, the Case-Shiller index is a lagging indicator of values — a moving average now two months old.