As the new year begins, many economists continue to predict improving housing market factors for 2013, while final results for the end of 2012 show large year-over-year gains. CoreLogic'sHome Price Index for November shows home prices were up on both a year-over-year and month-over-month basis.
According to the report, prices were up nationally by 7.4 percent when compared to November 2011, marking the largest increase since May 2006. When not including distressed sales, prices were up 6.7 percent from the previous year, and a smaller inventory of delinquent properties listed for sale should continue to boost prices throughout the new year. The data firm predicts December will post a 7.9 percent annual gain, while prices could drop by 0.5 percent from November levels, as this is typical of the slower season for transactions.
When looking at figures on a month-over-month basis, home prices increased 0.3 percent in November from October when accounting for short sales and real estate owned property transactions. When not including distressed sales, home prices were up 0.9 percent.
"For the first time in almost six years, most U.S. markets experienced sustained increases in home prices in 2012," said Anand Nallathambi, president and CEO or CoreLogic. "We still have a long way to go to return to 2005-2006 levels, but all signals currently point to a progressive stabilization of the housing market and the positive trend in home price appreciation to continue into 2013."
Arizona, Nevada and California continue to recover from lows throughout housing market slump
While home prices continue to posts overall gains, some states are taking longer to recover. CoreLogic reports that the five states with the most notable improvements include Arizona, where home prices increased 20.9 percent, while Nevada, Idaho, North Dakota and California all also posted gains of 11 percent or more when including distressed sales. When excluding distressed sales, the same states minus California saw the highest appreciation. Hawaii was added in place of the Golden State, as is posted an 11.6 percent increase in values.
Delaware, Illinois, New Jersey, Connecticut and Rhode Island all saw the lowest home price depreciation, all posting below 5 percent in declines. When not including distressed transactions, only two states saw lower home prices including Delaware and Alabama.
While home prices are expected to increase in 2013, real estate records from the National Association of Realtors suggest that 2012 could set a record as the most affordable year for housing. NAR predicts the overall Housing Affordability Index will reach 194, up from 186 recorded in 2011.