Good news for sellers: Single-family home prices continued to soar in August, marking the fastest year-over-year increase since February 2006. But don't expect the trend to continue.
The S&P/Case-Shiller index of the 20 largest metro areas rose 1.3 percent in August from a month earlier and 12.8 percent from August 2012.
David Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement that the rate of monthly increases reached its height in April of this year. "Since then, home prices continued to rise, but at a slower pace each month. This month, 16 cities reported smaller gains in August compared to July," he added.
Unfriendly trajectories for prices and rates
Blitzer attributes the smaller gains to rising mortgage rates and fewer mortgage applications. According to the Bankrate.com national survey of large lenders, the 30-year fixed-rate mortgage rate remained 4.27 percent this week.
Home prices rose in August from July in all 20 cities in the index. Las Vegas had the largest annual increase of 29.2 percent from a year earlier, followed by San Francisco with a 25.4 percent increase and Los Angeles with a 21.7 percent increase.
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