The U.S. housing market recovery has exhibited a number of positive signs over the past year, such as improving home sales, declining mortgage delinquency rate and steady home prices. When it comes to the latter, however, it appears that the strong month-over-month gains have been slowing of late.
According to recent data from the S&P/Case-Shiller Home Price Indices, U.S. home prices ended 2013 up 11.3 percent, slightly higher than the third quarter's 11.2 percent. Both the 10- and 20-city Composites had gains lower than those reported in November, at 13.6 percent and 13.4 percent, respectively.
"The S&P/Case-Shiller Home Price Index ended its best year since 2005," said David Blitzer, chairman of the Index Committee at S&P Dow Jones Indices. "However, gains are slowing from month-to-month and the strongest part of the recovery in home values may be over. Year-over-year values for the two monthly Composites weakened and the quarterly National Index barely improved. The seasonally adjusted data also exhibit some softness and loss of momentum."
These trends may be associated with weaker economic data across the entire country. Blitzer added that the number of existing homes sold was down, as were residential construction permits and housing starts. This could also be tied to seasonally cold weather throughout the nation.
Housing payments increase year-over-year
While the price gains for houses appears to be slowing, the monthly payments made by homebuyers is on the way up.
According to RealtyTrac, the estimated monthly housing payment for a median-priced three-bedroom home bought at the end of 2013 ticked up 21 percent year-over-year. That includes the mortgage, insurance, taxes, maintenance and other fees. In addition, several counties noted particularly high increases in this segment. For example, both Contra Costa and Sacramento counties in California saw monthly payments rise more than 50 percent. Wayne and Oakland counties in Michigan were up 45 percent, while Clark County, Nevada increased 43 percent.
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