Seattle-area home prices accelerated again in March, posting the biggest gain among all metro areas except San Francisco, according to the S&P/Case-Shiller 20-city index released Tuesday.
The average price of existing single-family homes in King, Snohomish and Pierce counties jumped 1.9 percent over February, when the average price rose 0.6 percent. The Seattle-area market hadn’t seen such robust price growth since last July’s buying frenzy amid rising interest rates.
Over the past 12 months, prices have risen 11.6 percent. For 13 consecutive months, prices have increased annually by double-digit percentages — but the market is still about 16 percent below its July 2007 peak.
Nationally, home prices in March gained 0.9 percent over the month and 12.4 percent over the year. Annual price gains have slowed in the last four months and 13 cities saw their appreciation moderate in March, said David Blitzer, chairman of the index committee at S&P Dow Jones Indexes. Las Vegas, Los Angeles, Phoenix, San Francisco and Tampa saw substantial slowdowns in their appreciation, he said.
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Still, every metro in the index except New York saw housing appreciate over the month, with Dallas and Denver hitting new peaks, according to S&P/Dow Jones Indexes. Several cities were “fairly close” to their previous peaks: Boston and Charlotte were less than 10 percent off.
“Housing indicators remain mixed,” Blitzer said in a statement. Virtually all of the gain in housing starts in April was in apartment construction, not single-family homes, and new-home sales haven’t picked up enough.
“Mortgage rates are near a seven-month low, but recent comments from the Fed point to bank-lending standards as a problem,” he said. “Other comments include arguments that student-loan debt is preventing many potential first-time buyers from entering the housing market.”
The nation’s housing market faces several challenges, according to Svenja Gudell, director of economic research at Seattle-based Zillow, a real-estate website.
Almost one in five homeowners with mortgages still owe more than the market value of their homes, and a key factor in home purchases — household formation — is historically low.
Moreover, in several West Coast markets, housing is becoming unaffordable where home values have risen faster than incomes.
By next March, Zillow forecasts average home prices in the Seattle metro area to rise by about 6 percent.
Sanjay Bhatt: 206-464-3103 or firstname.lastname@example.org On Twitter @sbhatt