Home prices in the United States rose in May, the steepest growth in seven years, signifying the housing market’s continued recovery, Bloomberg News reported. New York City, however, showed the smallest gain among major cities.
The S&P/Case-Shiller index of property values climbed 12.2 percent from May 2012 to May 2013, the biggest year-over-year gain since March 2006, after advancing 12.1 percent one month earlier. All 20 cities in the index showed an increase in prices year-over-year, but New York showed the smallest gain, at 3.3 percent.
The biggest gains were in San Francisco, with a 24.5 percent year-over-year increase, and Las Vegas, with a 23.3 percent year-over-year increase.
Historically low borrowing costs, a shortage of inventory and an improving job market have combined to boost demand and prices for residential property, Bloomberg News said.
“Supplies are tight across the country, and that generates higher prices,” Jonathan Basile, an economist at Credit Suisse in New York, told Bloomberg. “As you get further into the spring and the summer, the combination of higher price expectations and higher rate expectations are likely to generate even more activity and possibly even more price increases.” [Bloomberg News] – Hiten Samtani