By Paul OwersAugust 27, 2012 05:23 PM
Home prices in South Florida and across the nation increased in June, another indication that the housing market is rebounding from the six-year bust.
Prices in Palm Beach, Broward and Miami-Dade counties rose 1.6 percent from May and 4.4 percent from a year ago, figures from the Standard & Poor’s/Case-Shiller home price index show.
It’s the sixth consecutive month of annual increases in the three counties. Prices have climbed on a monthly basis since December.
The 19 other major metro areas covered by the index saw monthly improvement, while 12 other metros had year-over-year price gains.
“We seem to be witnessing exactly what we needed for a sustained recovery; monthly increases coupled with improving annual rates of change,” David M. Blitzer, chairman of the index committee, said in a statement Tuesday. “The market may have finally turned around.”
Case-Shiller tracks prices of the same house over time. Analysts say that’s a better measure than releasing a median price for homes sold in a month, as local Realtor trade groups do. The index does not include condominiums and trails Realtor data by a month.
July figures from local Realtor boards released last week showed rises in median prices across Palm Beach and Broward counties. Strong demand is cutting into the supply of available homes and raising values.
Affordable prices and historically low mortgage rates have helped revive the housing market in the past year. Investors are paying cash for properties and renting them out, while first-time buyers and young families say they feel prices have hit bottom.
Mike Larson, a housing analyst at Weiss Research in Jupiter, said he expects the market to slowly improve in the months ahead.
“This is probably a lasting stabilization, but we do have to watch the broader economy and see where that goes,” Larson said. “Low interest rates are good, but we have to have job growth pick up to see a real resurgence in housing.”
Phoenix, one of the markets hit hardest during the housing crash, had a 13.9 percent annual price increase in June, the largest among the metro areas tracked by the Case-Shiller index. Atlanta had the biggest year-over-year decline – 12.1 percent.
Still, some industry observers point to a recent rise in foreclosures and warn that price declines may soon follow. Some analysts say a so-called shadow inventory of properties in the foreclosure pipeline will hit the market in the coming months.
Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development, told the Los Angeles Times last week that he isn’t concerned about the inventory of distressed homes. But Roy Oppenheim, a Weston foreclosure defense lawyer and blogger, wrote this week that it’s premature to assume the worst of the housing collapse is over.
“Our government may want to paint a rosy picture, but they have been wrongfully optimistic before,” Oppenheim wrote. “The bottom line is until more people have sustainable jobs, only then will we be able to breathe a sigh of relief.”