U.S. Home Prices Surge in May | Nashville Real Estate

    And the positive real estate news keeps on rolling in!

    Recently released news shows that U.S. home prices jumped 12.2 percent in May as compared to a year ago. This jump is the largest annual gain since March 2006 and another sure-tell sign that the housing recovery is strengthening.

    The leading measures of U.S. residential real estate prices that track changes in the value of residential real estate both nationally as well as in 20 metropolitan regions, also known as the Standard & Poor/Case-Shiller 20-city home price index, released a report this past Tuesday showing a surge in home prices (2.4 percent) in May from April. The month-over-month gain nearly matched that at a 2.6 percent increase in April from March–thus far, that gain is the highest on record.

    The price increases were not just localized, either, but were widespread. All 20 cities showed gains in May from April and compared with a year ago.

    What’s behind the rise in home prices? Some suggest is might be due to the fact that more people are bidding on an extremely low inventory on the market. That, coupled with stable job gains and historically low mortgage rates have seemed to do the trick in encouraging more Americans to buy homes.

    Concern still exists though. Some worry that higher mortgage rates could slow home sales. Still, economists say that rates remain low by historic standards and would need to rise much higher to halt the current momentum. The average for a 30-year fixed loan was 4.31 percent for the week ended July 25. That number was up from the 3.49 percent a year earlier, per Freddie Mac.

    Despite the recent gains, home prices are still about 25 percent below the peaks they reached in July 2006. That’s a key reason the supply of homes for sale remains low, as many homeowners are waiting to recoup their losses before putting their houses on the market.

    Are you ready to list your home for sale and/or purchase a new one? Contact us today! Take a look at our current Nashville Real Estate listings here.

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