The housing market is one key asset class for Americans that is not suffering from the current stock market volatility. After the great recession, housing didn’t participate in the recovery, as it had to work through depressed pricing, a tight credit market, and the huge inventory of default and foreclosure properties. Now, housing is finally contributing strongly to overall economic growth.
The recently released Case-Shiller Home Price Index showed home prices gaining 4.5% in June 2015 compared to June 2014, a slightly larger year-over-year gain than reported in May when annual prices were up 4.4%. The 10-City Composite Index was 4.6% higher than a year earlier, a slightly lower increase than in May while the 20-City Composite gained 5.0% year-over-year, about the same as in the previous month.
In other housing news, the Census Bureau and the Department of Housing and Urban Development reported that sales of newly constructed homes were at a seasonally adjusted annual rate of 507,000, a 5.4% increase from the revised June level of 481,000. July sales are 25.8% higher than new home sales in the same month in 2014. At the end of July, there were 218,000 new homes available for sale, which based on the current rate of sales represents a 5.2-month supply.