The latest release from the S&P Case-Shiller house price index, (which is as close to being an official house price index as it gets in America) shows US house prices up by between 4.5% and 5.5% in the 12 months ending November last year, with the 10-city composite index up 4.5% and the 20-city composite up 5.5% during the period.
What will come as a massive surprise to some is the fact that New York became the only city in the 20 city composite index to experience a fall in prices, with all the rest experiencing growth during the period. Recently New York has been making the property headlines for all the right reasons, as it became one of the world's greatest safe-haven cities on a par even with London.
Not only did the other 19 cities experience growth, but the growth also accelerated compared to the previous 3 month period in most of them, indeed only Cleveland let the side down as its growth stayed the same as the previous 3 month period. Phoenix continues to shine like a Phoenix from the flame with the strongest growth of 22.8% compared to last year, which was also its 7th straight month of double-digit growth.
"The November monthly figures were stronger than October, with 10 cities seeing rising prices versus seven the month before." says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. "Phoenix and San Francisco were both up 1.4% in November followed by Minneapolis up 1.0%. On the down side, Chicago was again amongst the weakest with a drop of 1.3% for November.
"Winter is usually a weak period for housing which explains why we now see about half the cities with falling month-to-month prices compared to 20 out of 20 seeing rising prices last summer. The better annual price changes also point to seasonal weakness rather than a reversal in the housing market. Further evidence that the weakness is seasonal is seen in the seasonally adjusted figures: only New York saw prices fall on a seasonally adjusted basis while Cleveland was flat.
"Housing is clearly recovering. Prices are rising as are both new and existing home sales. Existing home sales in November were 5.0 million, highest since November 2009. New Home sales at 398,000 were the highest since June 2010. These figures confirm that housing is contributing to economic growth.”