Home prices continue to rise in Los Angeles and the U.S., but overall, they're still down from a year ago.
May Case-Shiller numbers are out, and for Los Angeles, the news is good. Prices moved up 2.2 percent from April to May, according to the index, which tracks data for both a 10- and 20-city group. This reinforces a trend that we saw starting earlier this year.
In L.A., February-March saw a tiny 0.1-percent increase after a January-February month-on-month decline. But the March-April uptick was better: 1.5 percent. This could mean that prices are gaining a footing and could start to build on their gains.
And now April-May was better still. In fact, with a 2.2-percent increase, L.A. matched the composite, which was up 2.2 percent in the aggregate. However, year-over-year, L.A. home prices for the period were down more than for the overall index: a decline of 2 percent.
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A construction worker on the top of a home under construction at a new housing development on in Petaluma, California. If we have hit bottom, we may start seeing more of this kind of activity.
Zillow, the online real estate service, has called a bottom for the U.S. housing market. Literally. This is from today's release:
Home values in the United States have reached a bottom. The Zillow Home Value Index (ZHVI) rose on an annual basis for the first time since 2007, increasing 0.2 percent year-over-year to $149,300, according to Zillow's second quarter Real Estate Market Reports. Values have risen for four consecutive months.
A rise of 0.2 percent may not be terribly significant, so take this all with a healthy grain of salt — and an awareness that Zillow, as Chicago Now's Gary Lucido points out, indexes home values based on its own metrics, rather than on actual sales, as does the important Case-Shiller index.
Case-Shiller for May comes out next week, so you can look at Zillow's pronouncement and say, "Hmmm...interesting timing!" And you'd be on to something, because Case-Shiller has been signalling at least the formation of a bottom in U.S. housing prices for a few months now.
The June Case-Shiller numbers are out, and while prices in Los Angeles and San Diego are only up 0.3% and 0.2% from May, respectively, there are other parts of the nation where prices have cratered far worse, year-over-year. LA is down 3.4% from last June, while San Diego is down 5.3%. But Chicago is down 7.4% and Minneapolis, 10.8%. Phoenix and Portland are both down more than 9%.
So it's looking like SoCal is beginning to put the brakes on the slide.
The big question is whether the very modest SoCal uptick will persist. At this point, teensy price increases over a few months could indicate that we're finally seeing the housing market stabilize. And the S&P/Case-Shiller analysis indicates that SoCal may be mounting a recovery that's not going to be dragged down by other hard-hit markets: