US home prices gain on lean availability levels

Washington: A larger-than-forecast increase in home prices in 20 US cities in March underscores both steady demand and lean inventory, figures from S&P CoreLogic Case-Shiller show.

Mortgage rates at a six-month low, along with a strong job market and healthier finances, are giving prospective buyers more wherewithal to make purchases. In addition to rising demand, persistent inventory shortages in the previously owned property market are also contributing to price gains.

At the same time, wage growth has been slower to pick up than property values, representing a potential headwind to even faster price gains.

“While there is some regional variation, prices are rising across the US,” David Blitzer, chairman of the S&P index committee, said in a statement. The gain reflected “unusually low inventory of homes for sale.”

He said “there is no way to tell when rising prices and mortgage rates will force a slowdown in housing”.