Home prices rise 0.9 percent

By Sari R. Updated on 10/30/2012

The nation’s home prices rose 0.9% this August as nineteen out of twenty cities in the Case-Shiller index reported monthly positive gains from July of 2012.  This increase in prices completely beat the expectations of analysts from Deutsche Bank, who had originally predicted a home price increase of 0.4% in August.  The twenty city composite grew by over two percent last year.  Eighteen of the twenty cities reported price increases from the month of July, which indicates a real estate market recovery.

Phoenix rose up as the most increased city, with home prices rising 18.8% from a year ago.  Dallas went unchanged with a 3.6% price increase, but Chicago’s prices fell 1.6% from a year ago.  Three cities had negative returns annually:  Chicago (1.6% decline), New York (2.3% decline) and Atlanta (6.1% decline). 

Analysts believe that this is a positive indicator for a total recovery of the housing market and will have a snowball effect on other aspects of the housing industry, such as the increase of single family housing starts and new/existing home sales.