CoreLogic: Home Prices Increased on Monthly and Annual Basis, Trend to Continue

CoreLogic is reporting that home prices, including sales of distressed homes, increased on both a monthly and annual basis in April.  The company's Home Price Index (HPI) increased of 2.2 percent compared to March which marked the second straight month for an increase.  Prices were 1.1 percent higher than in April 2011, the second straight improvement for that metric as well, the first time that has happened since June 2010.

When distressed sales, both sales of bank-owned real estate (REO) and short sales, are excluded from the calculations, prices were up 2.6 percent compared to March and this was the third consecutive monthly increase.  The annual increase for this set of figures was 1.9 percent.

CoreLogic initiated a new measure of pricing with the April report; a pending HPI that will project price trends.  The pending HPI for April indicates another 2.0 percent increase from April to May.  This new metric is based on Multiple Listing Service (MLS) data that measure price changes in the most recent month.

From the peak pricing seen in April 2006, the national index for all home prices has fallen 31.7 percent.  When distressed transactions are excluded, the peak-to-current change was 23.3 percent.  The greatest losses (including distressed properties) have been in Nevada (-58.9 percent), Florida (-46.5 percent), Arizona (-46.5 percent), Michigan (-43.6 percent) and California (-41.0 percent).

The states with the greatest increase in home prices including distressed sales were Arizona (+8.8 percent), the District of Columbia (+6.4 percent), and Florida (+5.5 percent.)  Montana and Utah each had increases of 5.4 percent.

When distressed sales were eliminated the greatest appreciation was seen in Utah (+5.3 percent), Idaho (+5.1 percent), Mississippi (+4.7 percent) and Louisiana and Arizona (+4.6 percent each.)

Prices are still dropping in a lot of states including Delaware (-11.9 percent), Illinois (-6.8 percent), Alabama (-6.6 percent) and Rhode Island (-6.2 percent).  These figures included distressed sales.  When distressed sales are not included Delaware still had a major loss of 10.1 percent followed by Rhode Island (-6.2 percent), and Alabama (-4.4 percent.)

Of the top 100 Core Based Statistical Areas (CBSAs) measured by population, 44 are showing year-over-year declines in April, 10 fewer than in March. 

"We see the consistent month-over-month increases within our HPI and Pending HPI as one sign that the housing market is stabilizing," said Anand Nallathambi, president and chief executive officer of CoreLogic. "Home prices are responding to a restricted supply that will likely exist for some time to come-an optimistic sign for the future of our industry."

"Excluding distressed sales, home prices in March and April are improving at a rate not seen since late 2006 and appreciating at a faster rate than during the tax-credit boomlet in 2010," said Mark Fleming, chief economist for CoreLogic.  "Nationally, the supply of homes in current inventory is down to 6.5 months, a level not seen in more than five years, in part driven by the 'locked in' position of so many homeowners in negative equity."