Seattle home prices up 10.6 percent in 12 months

Home prices in Seattle rose faster between February and March than in 18 of the 19 other cities tracked in a national index, but the region’s 12-month increase was in line with the national average.

Seattle prices rose 3.0 percent for the month, and 10.6 for the year, according to the Standard & Poor’s/Case-Shiller home-price index released Tuesday.

The monthly increase was the biggest since April 1990, and the 12-month increase the biggest since January 2007.

U.S. home prices jumped 10.9 percent in March compared with a year ago, the highest annual increase since April 2006. A growing number of buyers are bidding on a tight supply of homes, driving prices higher and helping the housing market recover.

Average home prices in the 20-city index are back to late 2003 levels. The index shows that average prices in the Seattle market have returned to where they were in the spring of 2005.

The index also showed that all 20 cities measured by the report posted annual gains for the third straight month.

And prices rose in 15 cities in March from February. That’s up from only 11 in the previous month. The monthly figures aren’t seasonally adjusted and may reflect the beginning of the spring buying season.

Annual prices rose in Phoenix by 22.5 percent, the biggest gain among the 20 cities. It was followed by San Francisco (22.2 percent) and Las Vegas (20.6 percent).

New York City had the smallest annual increase at 2.6 percent, followed by Cleveland at 4.8 percent.

Seattle’s February to March increase was topped only by San Francisco’s, at 3.9 percent.

The index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The March figures are the latest available.

The U.S. housing market is steadily recovering, buoyed by solid job gains and near-record low mortgage rates. Sales of new homes rose in April to nearly a five-year high. And sales of previously occupied homes ticked up in April to the highest level in three and a half years.

Despite the gains, a limited number of homeowners are putting their houses on the market. That’s helped lift home prices. And it’s made builders more willing to ramp up construction. Applications for building permits rose in April to the highest level in nearly five years.

The recovery is creating more construction jobs and bolstering the economy in other ways. Higher home prices make home­owners feel wealthier and encourages them to spend more.

Source: Seattle Times