US property prices up – and predicted to keep on rising

US property prices are up across the country and expected to keep rising, according to Clear Capital.

The average house price grew both on a quarterly (0.4 per cent) and year-on-year (0.1 per cent) basis in May, the asset valuation firm reports, the first time this has happened since August 2010. This was true of all regions across America, apart from the Midwest, where values declined at a slower rate compared to the company's previous report.

The price gains seen at the national, regional and metro levels are being driven in part by the significant increases in REO-only prices. In fact, national REO-only gains of 8.1% over the last year on a median price-per-square-foot basis have outpaced non-REO price declines of -0.7% by 8.8 percentage points. Looking at REO-only prices on a year-over-year basis helps highlight why the Midwest lags the other regions in overall growth.

"National real estate prices in May have finally moved past the continued losses of the last few years. The subsequent stabilization pattern seen in recent months has progressed into the start of moderate growth," comments Dr. Alex Villacorta, Director of Research and Analytics at Clear Capital.

"While gains in national home prices over the quarter and year were minimal in May, there are encouraging trends continuing to play out and gaining momentum beneath the surface," Villacorta added. "Strength in REO-only price trends as well as some early indications of price gains spreading from low tier sectors to the mid, and higher-priced homes is helping confirm that the country continues to make progress on its recovery, and we are expecting to see improvements extend over the next several months."

"Markets have continued to show signs of bottoming out. The projections we made at the beginning of the year are playing out and we expect to see the nation gain just over 1% through the year's end,' said Alex Villacorta, director of research and analytics at Clear Capital.

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