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West Coast home prices spike

By Judy Martel · Bankrate.com
Monday, August 26, 2013
Posted: 5 pm ET

Following the news about a jump in existing home sales, home prices continue to surge, particularly on the West Coast.

Prices in the Pacific region, which includes California and Washington, rose 16.2 percent from June 2012 to June of this year, according to a report by the Federal Housing Finance Agency. The Mountain region, including Nevada and Arizona, followed with an 11 percent jump. The region including New York, New Jersey and Pennsylvania had the smallest gain at 2.5 percent.

Meanwhile, including flyover country...

Nationwide, home prices went up 7.7 percent for the year. This follows the news last week from the National Association of Realtors that prices on existing homes advanced 13.7 percent in the year ending in July to a median price of $213,500.

During the second quarter this year, prices nationwide rose 2.1 percent from the previous quarter, according to the FHFA report. It's the eighth consecutive quarterly price increase. The biggest quarterly gains were in Nevada, followed by California, Arizona, Oregon and Washington, D.C.

Why values are rising

Many housing experts attribute the rise in sales, and therefore prices, to increased demand from buyers who want to close a deal before mortgage rates rise further. Although rates are still near historic lows and home prices haven't come near the heights achieved before the housing collapse, buyers are seeing the writing on the wall.

A year ago, the 30-year fixed mortgage rate was 3.86 percent, according to the Bankrate.com national survey of large lenders. The latest survey shows a rate of 4.74 percent for the 30-year fixed.

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