Single-family home prices rose again in May, but the gains indicated more a stabilization at a lower level than sustainable recovery, according to the S&P/Case-Shiller Home Price Indices released Tuesday.
The 10-City Composite Index form May was up 1.2% from April and up 5.4% from the same month last year. The 20-City Composite was up 1.3% sequentially and 4.6% year-over-year. The 10-City stood at 159.36, the 20-City at 146.43 at the end of the month.
Nineteen of the 20 MSAs showed month-over-month increases in May. The sole declining market was Las Vegas, which dropped 0.5% from April and was 6.5% below May, 2009. The Las Vegas Index, at 102.35, shows that single-family homes have returned nearly all the gains accumulated since the Case-Shiller benchmark month of January, 2000.
Likewise, the Cleveland and Atlanta indices, though up 1% and 2% respectively for the month and 3.7% and 1.7% on an annual comparison, remain below 110 at 105.85 and 107.82. Phoenix, at an index of 111, posted a 0.9% increase over April and a 7.2% rise over last May. Detroit remains the nation's worst market with an index of 68.29, and although it was up 0.7% sequentially, it remained 2.5% below May, 2009 and prices are back to 1994 levels.
The best performances again came from California, where San Francisco rose 1.7% from April to 142.16, 18.3% ahead of last May. San Diego rose 1.1% to 163.11, up 12.4% from the same month in 2009. Los Angeles rose 1.7% to 174.67, 9.7% above May, 2009. Washington D.C. remained the nation's strongest market with an index of 182.10, up 1.5% month-to-month and up 7.4% year-over-year.
New York, at 170.45, rose 0.8% on the month but was down 0.4% from last May.Chicago rose 1.2% to 121.90 but is 1.5% below May, 2009. Boston was up 1.6% to 155.95, 4.8% ahead of the same time last year. Minneapolis gained 2.8% to122.63 and was 11.6% above last May. Denver was up 0.6% over April to 128.24, up 3.6% from May, 2009. Dallas rose 1.5% to 119.93 in May and was 2.9% ahead of the same month last year, and Charlotte gained 0.3% to 116.39, still 2.8% behind last May. Boston, Charlotte, Cleveland, Dallas and Denver reported weaker annual growth rates compared to their reports from April.
"While May¹s report on its own looks somewhat positive, a broader look at home price levels over the past year still do not indicate that the housing market is in any form of sustained recovery," said David M. Blitzer, chairman of the index committee at Standard & Poor's. "Since reaching its recent trough in April 2009, the housing market has really only stabilized at this lower level. The two composites have improved between 5 and 6% since then, but this is no better than the improvement they had registered as of October 2009. The last seven months have basically been flat."
He added, "It still looks possible that the housing market might bounce along the bottom for the foreseeable future, before showing any real improvement that will filter through to the rest of the economy."
Learn more about markets featured in this article: Los Angeles, CA.