Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.
+1 212 318 2000
Europe, Middle East, & Africa
+44 20 7330 7500
+65 6212 1000
Another sign that the housing market is improving.
Clear Capital, which provides real estate valuation data for investors, said today that U.S. home prices jumped 5% in the quarter ending July 25 compared to the previous quarter.
The index showed an 11.2% quarter-over-quarter gain in the Midwest, a 5.3% gain in the South, a 2.4% increase in the Northeast, and a 1.1% rise in the West.
Clear Capital is trumpeting that it was the first index to report U.S. home price growth. It’s true that last month’s Clear Capital report came out a few weeks before the release of the Standard & Poor/Case-Shiller 20-city index, which showed home prices rising slightly in May, the first monthly gain in three years.
But technically, it was the Federal Housing Finance Agency’s index that was first to show an increase. The agency said in March that home prices rose 1.7% in January compared to December on a seasonally-adjusted basis.
The Clear Capital and Case Shiller price increases aren’t as significant as they might seem. It’s always best to compare home prices on a year-over-year basis to remove seasonal variations. Spring and Summer are the strongest buying seasons of the year. The indexes aren’t seasonally adjusted and, in both cases, prices were down when compared to the previous year.
(Clear Capital uses its own rolling quarterly average, which compares the most recent four months to the previous three months. It sounds confusing but it allows the company to come up with fresh quarterly data each month).
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.