Local home prices dip, though up 5.7 percent over 12 months
Seattle-area house prices fell slightly in October but remain up roughly 10 percent from their bottom last February.
Seattle Times staff and Associated Press
Seattle-area house prices fell slightly in October but more or less held to their levels of recent months, suggesting that the local market may have plateaued after a sharp rise earlier this year.
House prices nationally fell from September to October in 12 of the 20 cities tracked by the Standard & Poor’s/Case-Shiller index, according to new data released Wednesday.
Seattle’s monthly decline of 0.2 percent exceeded the national decline of 0.06 percent, but was still very modest overall.
Those declines likely reflect the end of the peak buying season.
But prices remained above their levels of a year earlier in all but two cities, New York and Chicago, suggesting that strength remains in the national market even as it moves into the more dormant fall and winter sales period.
The national Case-Shiller index rose 4.3 percent in October compared with a year ago. That’s the largest year-over-year increase in 2½years, when a homebuyer tax credit temporarily boosted sales.
Phoenix led all cities with a 21.7 percent gain, followed by Detroit, where prices increased 10 percent.
In Seattle, prices rose 5.7 percent year-over-year. While recent prices are at their highest levels since late 2010, the Seattle Case-Shiller index is still more than 26 percent below its July 2007 peak.
Local home prices hit bottom in February, when the Seattle index was nearly a third off its pre-bust peak. But the local index jumped nearly 10 percent over the next five months; it’s held fairly steady at that level since.
Still, the broader national trend is encouraging. October marked the fifth straight month of year-over-year gains, after nearly two years of declines. Prices rose in mid-2010 in the final months before the tax credit expired. They had fallen sharply in 2008 and 2009.
“It is clear that the housing recovery is gaining strength,” said David Blitzer, chairman of the index committee at S&P Dow Jones Indexes.
The S&P/Case-Shiller index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The October figures are the latest available.
Steady gains in home prices have helped drive a modest recovery in the housing market. Rising prices encourage more potential buyers to purchase homes. And more people may put their homes on the market as they gain confidence that they can sell at a good price.
Higher home prices also can make homeowners feel wealthier and make them more likely to spend more. Consumer spending accounts for about 70 percent of the U.S. economy.