New home sales rose 2.1 percent in May over April, according to Commerce Dept. figures, the highest rate since 2008. The S&P Case Shiller home price index (HPI) of existing homes rose 12.1 per cent from last year, the best rate in seven years, according to what David Blitzer of Dow Jones S&P tells abcnews. In addition, the survey of 20 major metro areas show average home prices rising in all 20 cities. He says: “The most recent Fed Senior Loan Officer Opinion Survey shows that some banks are easing credit restrictions. Given this, the recovery should continue.” Stan Humphries, Zillow’s chief economist, says, “The housing market worm has turned over the past few weeks – inventory levels are beginning to show signs of easing, and mortgage interest rates are creeping up. Going forward, both of these factors will help mitigate extreme price spikes caused by very strong housing demand and very low housing supply.” As MHProNews has learned, he says while the recovery is strong and sustainable, prices will not continue rising at the current rate.
(Photo credit: Reuters)