NEW YORK, June 27 US single-family home prices accelerated at a slower pace than expected in April, a survey showed on Tuesday. Month-over-month, the 10-City Composite rose 0.8 percent and the 20-City Composite rose 0.9 percent.
San Diego home prices rose 0.9 percent between March and April, and have climbed 6.6 percent since April of a year ago, according to the Standard & Poor's CoreLogic Case-Shiller Indices released Tuesday.
Nationally, home prices rose 0.9 percent in April and are 5.5 percent higher than a year prior. Seattle (12.9 percent), Portland (9.3 percent) and Dallas (8.4 percent) experienced the sharpest annual gains, closely followed by Denver.More news: Oil declines for fifth week as supply climbs
David M. Blitzer, chairman of the index committee at S&P, said in a statement that he's not anxious about another national housing downturn, citing low levels of household debt and mortgage default rates. And, could this be a bubble?
"If mortgage rates, now near 4 percent, rise further, this could deter more people from selling and keep pressure on inventories and prices", Blitzer said in a statement. At the same time, the supply of homes for sale has barely kept pace with demand and the inventory of new or existing homes for sale shrunk down to only a four- month supply. That annual growth rate was a step back from a 4.4 percent increase in March. Analysts were expecting an increase of 5.9 percent for the month, according to Thomson Reuters consensus estimates.
Their data says that rental single-family homes have grown by 45 percent since 2000, especially just south of the Seattle city limits.More news: McCarthy found guilty of 2nd-degree murder of Bella Bond
He said increased construction, a low rate of mortgage defaults and manageable household debt should prevent a crash.
Housing market observers have long speculated a looming increase in mortgage rates could slow demand, in turn putting the brakes on home prices. Low mortgage rates are also encouraging more Americans to buy homes. And many single-family homes were converted to rentals after the housing bust and are likely to remain off the for-sale market.
The average rate on a 30-year fixed-rate mortgage, the most popular USA home loan, was 4.13 percent in the latest week, down from 4.47 percent three months earlier, according to the Mortgage Bankers Association.More news: ICC extends support to three World XI T20s in Lahore