US Prices Gain 5% in Quarter, Clear Capital Says
House prices across the US increased 5% over the previous quarter. All regions saw quarterly gains as of July, with the Midwest soaring 11.2%, the South rising 5.3%, the Northeast posting a 2.4% increase and the West gaining 1.1%, according to Clear Capital. The real estate asset valuation, investment and risk assessment provider tracks price changes on a rolling quarter basis, which it says reduces multi-month lag time for investors, buyers and servicers looking for accurate data. Company president Kevin Marshall acknowledged the emerging argument in the industry over whether the rising trends show signs of green shoots or seasonality. “People do buy and sell more homes in the summer, and as a result prices do increase during this season," he said. “As with any housing recovery," he added, "small pockets of neighborhoods and specific price tiers are leading the way and posting gains. As individual markets turn, it’s very easy to under price REO listings when you don’t have the most recent, geographically relevant data. Everyone working to get us out of this downturn needs to be very aware of this.” Regionally, the West gained on improved interest in its high REO saturated markets. This saturation "typically increases the volatility of these markets" and may keep the gap between the lowest performing region, the West, and the South's high performance, Clear Capital said. More than half of the highest performing local markets doubled their quarterly gains from last month's report. Clear Capital said the gains reflect improving market demand, allowing banks to receive a higher sales price for REO properties, which represent up to 60% of all sales in some regions. Several Ohio markets led the nation in terms of quarterly gains on a local basis. The metropolitan statistical area (MSA) including Cleveland saw a 46% quarterly gain in prices, even though the REO properties accounted for 41.1% of sales. The Las Vegas-Paradise MSA posted the worst performance on a quarterly basis, dropping 9.1% in the last quarter as REO saturated 66.9% of its sales. Write to Diana Golobay.