Home Prices Jump in October -- Update

By Imani Moise Features Dow Jones Newswires

Home prices continued to rise in October marking more than 12 consecutive months of growth.

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The S&P CoreLogic Case-Shiller National Home Price Index, which measures prices for typical single family homes across the country, rose 6.2% in the 12 months ended in October, up slightly from a 6.1% year-over-year increase reported in September.

As the rising cost of buying a home outpaces inflation, the pace of home sales have slowed. Sales of existing homes dropped 6.1% from March through September. Sales bounced back 8.4% in November.

"Since home prices are rising faster than wages, salaries, and inflation, some areas could see potential home buyers compelled to look at renting, " said David Blitzer, managing director at S&P Dow Jones Indices.

Economists have said they aren't concerned about waning demand because prices are continuing to rise so briskly.

The 10-city index gained 6% year over year, up from 5.7% in September. The 20-city index gained 6.4%, up from 6.2% the previous month. Economists surveyed by The Wall Street Journal expected the 20-city index to rise 6.2% in September.

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The average rate for a 30-year mortgage touched 3.94% last week, up from a year earlier when it averaged 4.3%, according to Freddie Mac.

Seattle reported the highest increase in home prices, jumping 12.7% year-over-year.

Month-over-month, the U.S. Index rose 0.2% in October before seasonal adjustment, with the 10-city and 20-city index rising by the same amount.

After seasonal adjustment, each of the indices rose by 0.7%.

Write to Imani Moise at imani.moise@wsj.com

Home prices continued to rise in October as demand increased for homes but tight inventories nationwide limited supply.

The S&P CoreLogic Case-Shiller National Home Price Index, which measures prices for typical single-family homes across the country, rose 6.2% in the 12 months ended in October, up slightly from a 6.1% year-over-year increase reported in September.

Seattle reported the highest increase in home prices, jumping 12.7% year-over-year.

As the rising cost of buying a home outpaces inflation, the pace of home sales has slowed. Sales of existing homes dropped 6.1% from March through September. Sales bounced back 8.4% in November.

"Since home prices are rising faster than wages, salaries, and inflation, some areas could see potential home buyers compelled to look at renting, " said David Blitzer, managing director at S&P Dow Jones Indices.

Economists have said they aren't concerned about losing potential homeowners to the rental market because prices are continuing to rise so briskly.

"I don't think there's been a near-term shift in rental demand," said Zillow Senior Economist Aaron Terrazas, noting that the homeownership rate increased slightly during the third quarter, according to the U.S. Census Bureau.

Mr. Terrazas said home-building has begun to ramp up in recent months though it isn't enough yet to match demand.

The 10-city index gained 6% year over year, up from 5.7% in September. The 20-city index gained 6.4%, up from 6.2% the previous month. Economists surveyed by The Wall Street Journal expected the 20-city index to rise 6.2% in September.

The average rate for a 30-year mortgage touched 3.94% last week, down from a year earlier when it averaged 4.3%, according to Freddie Mac.

Month-over-month, the U.S. Index rose 0.2% in October before seasonal adjustment, with the 10-city and 20-city index rising by the same amount. After seasonal adjustment, each of the indexes rose by 0.7%.

Write to Imani Moise at imani.moise@wsj.com

(END) Dow Jones Newswires

December 26, 2017 12:17 ET (17:17 GMT)