By Prashant Gopal Bloomberg News
Prices for single-family homes climbed in most U.S. cities in the second quarter and values nationally jumped the most since 2006 as real estate markets stabilized.
The median sales price increased from a year earlier in 110 of 146 metropolitan areas measured, the National Association of Realtors reported Thursday. In the first quarter, 74 areas had gains.
U.S. housing prices are beginning to lift off the bottom after the worst housing slump since the 1930s as buyers compete for a tight supply of available properties. At the end of June, 2.39 million previously owned homes were available for sale, 24 percent fewer than a year earlier, the Realtors said.
“The turnaround in home prices feels pretty broad,” Celia Chen, a housing economist at Moody’s Analytics in West Chester, Pa., said. “But I think there are still risks that home prices will dip a little more before they start appreciating with any consistency,”
One threat to home values is the so-called shadow inventory of delinquent properties that have yet to enter the market. U.S. foreclosure starts rose 6 percent last month from July 2011, Irvine, Calif.-based data provider RealtyTrac said Thursday.
The national median existing single-family home price was $181,500 in the second quarter, up 7.3 percent from the same period last year, the strongest annual increase since the first quarter of 2006, according to the Realtors group. Distressed homes, including discounted foreclosures and short sales, accounted for 26 percent of second quarter sales, down from 33 percent a year earlier.
The share of all-cash home purchases was 29 percent in the second quarter, down from 30 percent in the second quarter of 2011. Investors, who make up the bulk of cash purchasers and compete with first-time buyers, accounted for 19 percent of all transactions, matching the share a year earlier.
Other indexes also showed gains in prices. Corelogic Inc. said nationwide home prices climbed 2.5 percent in June from a year earlier, the fourth consecutive increase, according to an Aug. 7 report by the Santa Ana, Calif.-based data company.
Freddie Mac said prices gained 4.8 percent from March to June, the biggest quarterly pickup in eight years.
The shadow inventory may be less of a threat to the market because of a shrinking supply of vacant homes and a decline in the number of bank-owned properties for sale, the McLean, Va.-based mortgage financier said.