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House prices continued to improve in May with Standard and Poor's reporting the second consecutive monthly increase in both Case-Shiller composite house price indexes (HPIs) in May. Case-Shiller Composite 20 (CS20) gained 1.1 percent (NSA) and the Composite 10 (CS10) was up 1 percent. This follows a 0.6 percent increase in both indexes in April, which was the first monthly increase since July 2010. Prices improved in 16 of the 20 cities covered by the index on a non-seasonally adjusted basis. The greatest improvements were observed in Boston (+2.7 percent), Washington DC (+2.4 percent), Minneapolis (+2.6 percent), San Francisco (+1.8 percent) and Chicago (1.7 percent). Prices continued to fall in Detroit (-2.8 percent), Las Vegas (-0.9 percent) and Tampa (-0.6 percent). Phoenix was unchanged. Of the 20 metropolitan areas covered by the index, Washington DC is the only city with a positive annual rate of change-up 1.3 percent. All others were down relative to May last year, with Minneapolis (-11.7 percent), Tampa (-9.5 percent), Phoenix (-9.5 percent), Detroit (-9.3 percent) and Portland (-9.1 percent) faring the worst. These year-over-year declines, however, should be considered in context. House prices in May 2010 received a boost from the increased demand stimulated in the closing stages of the home buyer tax credit. The increases are a positive signal that the price declines experienced in the post-tax credit period have subsided. Some markets seem to be moving up based on their own improving conditions. |
