News / Economy

    US Home Prices See Biggest Gain in 7 Years

    US Home Prices See Biggest Gain in 7 Yearsi
    X
    June 25, 2013 11:01 PM
    A new report confirms U.S. home prices are on the rise. Of 20 major cities in the Standard & Poor’s/Case Schiller home price index - 12 posted double digit gains in April, compared to last year. Industry experts say prices will continue to rise due to smaller inventories but some say tight lending standards and rising interest rates could put a damper on the housing recovery. Mil Arcega has more for VOA.
    A new report confirms U.S. home prices are on the rise.  Of 20 major cities in the Standard & Poor’s/Case Schiller home price index - 12 posted double digit gains in April, compared to last year.  Industry experts say prices will continue to rise due to smaller inventories but some say tight lending standards and rising interest rates could put a damper on the housing recovery. 

    U.S. home prices are up more than 12 percent since last year.

    That bodes well for the world’s largest economy and could help offset the drag from higher taxes and government spending cuts.  
    Lawrence Yun is the chief economist for the National Association of Realtors.

    “When home values rise, this is good news for the economy because for many homeowners, they feel wealthier, they feel more comfortable going out and spending money," said Yun.

    Home prices are rising because there are fewer homes to buy.  But despite historically low interest rates, Yun says construction of new homes has not kept pace.

    “Construction loan availability is very difficult at the moment so the homebuilders who are in the market are relying not on construction loans but are going to Wall Street and issuing bonds, issuing stocks, so these are big homebuilders, publicly listed companies who can tap Wall Street funds - who are able to build.  But many of the smaller builders are shut out of the market and they are unable to enter," he said.

    A sustainable housing market is important for global economic stability because severe problems with the U.S. market played a key role in the financial crisis and the global recession that followed.

    Ken Simonson at the National Association for Business Economics says buyers are more wary now.

    “I think there’s been quite a change in attitude among potential first-time homebuyers.  They saw what happened a decade ago to people who bought, confident they could sell at any time and instead they wound up being stuck in their home or being kicked out of their home and that really made people more cautious about buying a home," said Simonson.

    While some economists say tight lending standards and rising interest rates could constrain recent price gains, home builders are more optimistic.  

    The National Association of Home Builders’ confidence index is at a seven-year high.  The group says that means more home construction projects - and more jobs.

    You May Like

    California Republicans Mull Choices in Presidential Race

    Ted Cruz tells state's Republican Convention delegates campaign will be 'battle on the ground, district by district by district,' ahead of June 7 primary

    Video Kurdish Football Team Helps War-Torn City Cope

    With conflict still raging across much of Turkey’s predominantly Kurdish southeast, many Kurds are trying to escape turmoil by focusing on success of football team Amedspor

    South African Company Designs Unique Solar Cooker

    Two-man team of solar power technologists introduces Sol4, hot plate that heats up so fast it’s like cooking with gas or electricity

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Turkish Kurd Islamist Rally Stokes Tensionsi
    X
    April 29, 2016 12:28 AM
    In a sign of the rising power of Islamists in Turkey, more than 100,000 people recently gathered in Diyarbakir, the main city in Turkey’s predominantly Kurdish southeast, to mark the birthday of the Prophet Muhammad. The gathering highlighted tensions with the pro-secular Kurdish nationalist movement. Dorian Jones reports from Diyarbakir.
    Video

    Video Turkish Kurd Islamist Rally Stokes Tensions

    In a sign of the rising power of Islamists in Turkey, more than 100,000 people recently gathered in Diyarbakir, the main city in Turkey’s predominantly Kurdish southeast, to mark the birthday of the Prophet Muhammad. The gathering highlighted tensions with the pro-secular Kurdish nationalist movement. Dorian Jones reports from Diyarbakir.
    Video

    Video Pakistani School Helps Slum Kids

    Master Mohammad Ayub runs a makeshift school in a public park in Islamabad. Thousands of poor children have benefited from his services over the years, but, as VOA's Ayesha Tanzeem reports, roughly 25 million school-age youths don't get an education in Pakistan.
    Video

    Video Florida’s Weeki Wachee ‘Mermaids’ Make a Splash

    Since 1947, ‘mermaids’ have fascinated tourists at central Florida’s Weeki Wachee Springs State Park with their fluid movements and synchronized ballet. Performing underwater has its challenges, including cold temperatures and a steady current, as VOA’s Lin Yang and Joseph Mok report.
    Video

    Video Somali, African Union Forces Face Resurgent Al-Shabab

    The Islamic State terror group claimed its first attack in Somalia earlier this week, though the claim has not been verified by forces on the ground. Meanwhile, al-Shabab militants have stepped up their attacks as Somalia prepares for elections later this year. Henry Ridgwell reports there are growing frustrations among Somalia’s Western backers over the country’s slow progress in forming its own armed forces to establish security after 25 years of chaos.
    Video

    Video Bangladesh Targeted Killings Spark Wave of Fear

    People in Bangladesh’s capital are expressing deep concern over the brutal attacks that have killed secular blogger, and most recently a gay rights activist and an employee of the U.S. embassy. Xulhaz Mannan, an embassy protocol officer and the editor of the country’s only gay and transgender magazine Roopban; and his friend Mehboob Rabbi Tanoy, a gay rights activist, were hacked to death by five attackers in Mannan’s Dhaka home earlier this month.
    Video

    Video Documentary Tells Tale of Chernobyl Returnees

    Ukraine this week is marking the 30th anniversary of the world's worst nuclear accident, at the Chernobyl nuclear power plant. Soviet officials at first said little about the accident, but later evacuated a 2,600-square-kilometer "exclusion zone." Some people, though, came back. American directors Holly Morris and Anne Bogart created a documentary about this faithful and brave community. VOA's Tetiana Kharchenko reports from New York on "The Babushkas of Chernobyl." Carol Pearson narrates.
    Video

    Video Nigerians Feel Bite of Buhari Economic Policy

    Despite the global drop in the price of oil, Nigerian President Muhammadu Buhari has refused to allow the country's currency to devalue, leading to a shortage of foreign exchange. Chris Stein reports from Lagos businessmen and consumers are feeling the impact as the country deals with a severe fuel shortage.
    Video

    Video  Return to the Wild

    There’s a growing trend in the United States to let old or underused golf courses revert back to nature. But as Erika Celeste reports from one parcel in Grafton, Ohio, converting 39 hectares of land back to green space is a lot more complicated than just not mowing the fairway.
    Video

    Video West Urges Unity in Libya as Migrant Numbers Soar

    The Italian government says a NATO-led mission aimed at stemming the flow of migrants from Libya to Europe could be up and running by July. There are concerns that the number of migrants could soar as the route through Greece and the Balkans remains blocked. Western powers say the political chaos in Libya is being exploited by people smugglers — and they are pressuring rival groups to come together under the new unity government. VOA's Henry Ridgwell reports.
    Video

    Video Russia’s TV Rain Swims Against Tide in Sea of Kremlin Propaganda

    Russia’s media freedoms have been gradually eroded under President Vladimir Putin as his government has increased state ownership, influence, and restrictions on critical reporting. Television, where most Russians get their news, has been the main target and is now almost completely state controlled. But in the Russian capital, TV Rain stands out as an island in a sea of Kremlin propaganda.

    Special Report

    Adrift The Invisible African Diaspora

    World Currencies

    EUR
    USD
    0.8769
    JPY
    USD
    107.28
    GBP
    USD
    0.6842
    CAD
    USD
    1.2528
    INR
    USD
    66.384

    Rates may not be current.