U.S. residential property values are up for the second month in April, according to FNC Inc.‘s latest Residential Price Index, out Monday. Nationwide, home prices were up 0.6% from March.
The numbers are evidence that home prices are strengthening amid rising demand and limited inventory. According to the report, another likely contributor to the increase in prices is the continued decline in the number of distressed properties in total home sales.
The data, based on recorded sales transactions in the 100 largest metropolitan areas, exclude the sales of foreclosed homes, which are typically sold with price discounts reflecting poor property conditions.
All three RPI composites – the National, 30-MSA and 10-MSA indices – were up in April, and the two narrower indices indicate that home prices rose faster in the nation’s largest markets. April’s negative 2.4% year-over-year marks the slowest pace of price declines since the housing crash, and indices’ over all year-over-year trends continue to show a slow down in the pace of price declines compared to a year ago.
The majority of the markets tracked by the FNC 30-MSA show that prices were up in April. Only five metro areas (Miami, Orlando, Tampa, St. Louis and Washington D.C.) showed a drop in during the month of April. Almost a dozen cities, including Chicago, Las Vegas and Los Angeles, experienced moderate climb in prices, while Detroit, Nashville and Portland saw the largest gains.
Miami’s and Tampa’s April drop came after home prices rose for five consecutive months from November to March. According to the report, the set back is likely due to “a modest increase in the share of foreclosure sales during the month, which drives down prices on sales of non-distressed properties.”
The other three cities that experienced lower home prices in April – Orlando, St. Louis and Washington D.C. – saw an absence of indications of a spring sale season. Home prices declined in each city every month since January, averaging 0.9% in Orland, 1.4% in St. Louis and 2% in Washington D.C. each month. These three cities currently rank works among the nation’s major housing markets in terms of year-over-year price depreciation.
Peak to date, almost half of the component markets in the FNC 30-MSA composite index continued to show 30% or higher declines in property values. In eight MSAs, homes lost almost 50% or more of their peak market value.
Leading those declines are Las Vegas at 61.8%, Orlando at 58.6%, Phoenix and Riverside at 58.1% and Miami at 54.4%. This is in stark contrast to a positive peak-to-date price change out of two of Texas’ largest cities, Houston and San Antonio, which average about 3% and 4% above the July 2006 market peak, respectively.
