Median prices of single family homes rose 0.9% in July from June, but they’re still down year-over-year by 11.4%, according to the July Home Price Index report released today by Denver-based Integrated Asset Services LLC.
The index, which is not seasonally adjusted, tracks monthly changes in median home sale prices of single family homes in 360 counties, nine census divisions, four regions and the nation overall.
The biggest gains were seen in the Midwest, where median prices rose 3.1% in July, and are only down 0.4% from a year ago.
This was followed by the South, where prices increased 1.7%, but were down 8.2% from a year earlier, and the Northeast, where prices ticked up 1.6%, but declined 6.1% from the same month a year ago.
The West was the only region reporting a decline, falling 0.7% from June and 18% from a year earlier.
Looking at metropolitan areas, New York saw the biggest gain, rising 3.8% from June. This was followed by the Chicago area, which saw median prices tick up 2.9% on average.
Meanwhile, the Pending Home Sales Index, which tracks contracts signed, fell in July, declining 3.2% from June and 6.8% from a year ago, according to the National Association of Realtors in Chicago.
“Overly stringent lending criteria imposed by
Fannie Mae [of Washington] and Freddie Mac [of McLean, Va.] in the past month no doubt held back contract signings,” Lawrence Yun, chief economist at NAR, said in a statement.
Still, the decline was the smallest year-over-year decrease since December 2006.
Mr. Yun noted that contract signings have significantly increased in certain regions. “Contract signings have been steaming ahead, nearly doubling in activity from a year before in several California and Florida markets,” he said.
However, the Northeast region retreated following a robust gain in June, and activity was soft “in the broad midsection of America despite very affordable conditions,” he said.
Based on individual market fundamentals, Mr. Yun expects robust home price growth in Denver and Houston over the next two years.
He also speculates that price declines may be leveling off in California and Florida.
“The frequent reporting of multiple bids in California and Florida may be signaling a bottom in home prices in these areas,” he said in the statement.
Sales of existing homes are expected to total 5.01 million this year and rise 6.9% to 5.35 million in 2009, NAR predicts.
Home prices are expected to tumble 4% to 7% on average in 2008 and rise 2% to 4% in 2009, the group projects.
Sales of new homes are projected to total 508,000 in 2008 and fall to 463,000 in 2009.
