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Data and analytics provider CoreLogic has released a report indicating that home prices increased 5 percent in September compared to a year ago. This makes seven months in a row that prices have increased nationally on a year-over-year basis, suggesting that the housing market is on its way to a recovery.
On the downside, CoreLogic reports that, compared to August, home prices dropped by 0.3 percent. This decline was heavily weighted by distressed sales, such as short sales and real estate-owned transactions. Not including distressed sales, home prices increased 0.5 percent in September compared to August.
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“Home prices are responding to better market fundamentals, such as reduced inventories and improved buyer demand,” said CoreLogic CEO Anand Nallathambi in the report. “So far this year, we’re seeing signs of stabilization and improvement that show promise for a gradual recovery in the residential housing market.”
CoreLogic’s report builds on a positive release from the S&P/Case-Shiller Hope Prices Indices at the end of October. The report showed that home prices for the 10- and 20-City Composites increased by 0.9 percent in August compared to July.
Chairman of the Index David Blitzer foreshadowed the CoreLogic report by saying, “The sustained good news in home prices over the past five months makes us optimistic for continued recovery in the housing market. News on home prices confirms other good news about housing.”
It’s unlikely that September’s small relative drop compared to August will be a decisive factor in anyone’s perception of the economy. Home prices have been trekking slowly upwards for seven straight months and most economic indicators point to the same general trend. Things are not good, but they’re getting better, a message right in line with what President Barack Obama wants voters to think heading to the polls.
On the other side of the aisle, a real economic recovery is more than a slow trod in the right direction. Home prices may be recovering, but the economy is far from healed.
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