A recent Boston.com article gives a brief and clear portrait of home prices in the U.S. The article focuses on recent reports that home prices are steadily rising. Based on statistics from June 2013, home prices since June 2012 have risen almost 12 percent. This is an encouraging number for the housing market as a whole, as well as those homeowners whose homes lost much of their value during the housing crisis. It seems though, that while housing prices have climbed, the amount of houses on the market remains relatively low.
While the 12 percent rise is a national average, prices rose almost across the board. Only Delaware and Mississippi did not see gains in price. On the other hand, Nevada and California led the nation in price increases, both posting growth over 20 percent in the past year. Wyoming, Arizona, and Georgia also experienced healthy growth with percentages over the national average.
So what’s behind the rise in housing prices across the nation? The Boston.com article posits several factors including steadier job creation and low mortgage rates have led to the climbing prices. It also suggests that because the dearth of homes on the market, coupled with a rising demand has contributed to the price increases.
While all of this is positive news for the U.S. housing market, some worry that rising mortgage rates could cause the rate of sales to slow down. This is a legitimate concern, since mortgage rates continue to rise, but they still remain low by “historical standards.”
Rising prices aren’t the only good news in the housing market. New data shows that foreclosures are projected to be 25% lower this year than they were in 2012.
One of the most interesting points made in the article is that even with these steady gains, the average price of a home is still almost 20% less than it was before the housing crash. That number really puts in perspective how steep the precipice was and how much growth is still necessary to get back to 2006 housing prices.