Though relatively unchanged in September after enjoying six months of modest growth, home values were up 2.3 percent from September 2011. On a quarterly basis, home prices rose 1.8 percent during the third quarter, according to FNC’s latest Residential Price Index (RPI).
Year to date, home prices were up 4.5 percent from January. Foreclosures as a percentage of total home sales continue to decline, down to 17.2 percent in September, compared to 26.7 percent in January 2012 and 23% in September 2011. As a gauge of underlying home value, the RPI excludes sales of foreclosed homes, which are frequently sold with large price discounts reflecting poor property conditions.
On a year-over-year basis, home prices nationwide continue to strengthen, rising 2.3 percent from a year ago, the largest increase since February 2007 and the third consecutive month of positive year-over-year growth. FNC’s 30-MSA and 10-MSA composites also hit an all-time high in year-over-year price appreciation since February 2007. On a quarterly basis, the composites are up about 2.0 percent from the previous quarter.
The component markets tracked by the FNC 30-MSA composite index show a 60-40 divide in the month-to-month price change in September. Home prices rose 2.7 percent in Phoenix, 2.1 percent in Charlotte, 1.9 percent in San Diego, 1.9 percent in Las Vegas, and 1.8 percent in Orlando. Based on a three-month moving average (July, August, and September), Phoenix, Detroit, San Francisco, Sacramento, and New York show the largest price improvement, up 7.1 percent, 6.8 percent, 5.5 percent, 3.5 percent, and 3.5 percent respectively during the third quarter.
The year-over-year and year-to-date trends continue to show marked improvement. Most notably, Phoenix continues to lead the nation in the housing recovery. The city’s home prices rebounded 17.6 percent from a year ago and 19.2 percent from January 2012. Distressed sales in the Phoenix market continue to decline rapidly, falling well below the national average during the second and third quarters.
Regionally, a number of northeastern housing markets affected by Hurricane Sandy will likely show a marked slowdown in recovery due to delays in mortgage financing, appraisals, foreclosures, and new construction.