According to S&P/Case-Shiller Home Price Indices, home prices continued to rise in August. Photo by Kevork Djansezian/Getty Images
With election day a mere week away, all economic data carry potential political significance — for us in the media, at least. By the “significance” standard, today’s Case Shiller numbers would seem to augur well for the sitting President.
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Prices were up in 19 of 20 major cities, with a decline only in Seattle. But Washington is a state President Obama has no chance of losing, according to fivethirtyeight.com’s Nate Silver.
The average price of a house rose nearly 1 percent for the month of August alone. And prices are now up in 17 of 20 cities, year-to-year, with only Atlanta (-6.1 percent), New York (-2.3 percent) and Chicago (-1.6 percent) below last August’s prices.
Today’s average housing prices are now on par with those of the summer/autumn of 2003.
Best not to wax with too much enthusiasm when it comes to any short run of data, of course. As our chart shows, home prices rallied dramatically in 2010, only to drop again sharply last year.
But for the moment, things continue to look up, and today’s data are buttressed by other positive housing indicators as well.
Prices not adjusted for inflation.
Bloomberg.com cites the Commerce Department, which reported last week that Americans bought new homes in September at the fastest pace in two years, with demand up 27.1 percent from a year ago.
Looking for the cloud, not the silver lining? The average rate on a 30-year, fixed-rate mortgage is still at historically bargain-basement lows, down near the 3.36 percent rate available a few weeks ago. This 3.36 is the lowest recorded in data going back to 1972, according to Freddie Mac. And I would guess (without doing my own down-drilling) as low as they’ve ever been, if not lower.
If interest rates rise, as experts have been predicting for years now, won’t it kill the housing rally? There. I hope the pessimists among you are now satisfied. For the rest of you, bask in the numbers. They’re pretty darn good.
Interactives by Justin Myers.
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This entry is cross-posted on the Making Sen$e page, where correspondent Paul Solman answers your economic and business questions