The housing sector continues to improve amid a number of factors that may have both positive and negative effects on the market.
New property data released by the FHFA reported that home prices in the U.S. are up slightly, as the recent House Price Index showed gains for May. It illustrates monthly price changes across the U.S., including regional breakdowns for seasonally-adjusted and year-over-year fluctuations.
July's report is another in a string of increasing statistics, as real estate has made widespread advancements over the past few years. At the moment it may be considered good times, some people are concerned about a return to the problems last seen in the late 2000s.
"The U.S. housing market as a whole is currently not experiencing a bubble, but in many places it sure must feel like one," Svenja Gudell, senior economist at Zillow, said in a statement. "Homeowners are feeling a sense of whiplash after years of depreciation."
It may be possible that a reduced number of homes for sale given the high demand has made it more difficult to buy, and the possible seller's market has helped drive prices up as more people compete for the same home. The HPI for May 2012 reported prices were more than 7 percent lower than in 2013, and May 2013 prices were 0.7 percent higher than April. While the conditions may slightly appear to be like a bubble, the current U.S. index is still 11.2 percent lower than its peak in April 2007, near the breaking point for the economic recession.
Despite the gains, not all regions in the U.S. posted positive numbers. The HPI showed that the East South Central division, comprised of Kentucky, Tennessee, Mississippi and Alabama, actually had depreciating home prices, dropping 1.5 percent from month-to-month. Regardless, the change is an improvement from the same time in 2012.
Fannie Mae optimistic about rest of 2013
Real estate records have provided a number of encouraging financial indicators, Fannie Mae's Economic and Strategic Research Group believes the housing market will help bolster economic growth.
"We are keeping a very close eye on the effect of rising mortgage rates on the housing market and the economy, but our July forecast is little changed from last month," said Doug Duncan, chief economist for Fannie Mae.
The government enterprise expects mortgage rates to continue to go up, but few variations are forecasted for home sales overall - only predicting an 8 percent increase for the remainder of 2013.