Seattle and Portland home prices rise at twice the national rate

Home prices in the Northwest continued to climb at a double-digit pace in June compared to a year ago, easily twice the rate for the nation’s 20 largest metro areas, according to the Standard & Poor’s CoreLogic Case-Shiller 20-city home price index.

WASHINGTON — Home prices in the Northwest continued to climb at a double-digit pace in June compared to a year ago, easily twice the rate for the nation’s 20 largest metro areas.

Seattle home prices rose 11 percent, second only to Portland, where prices rose 12.6 percent, according to the Standard & Poor’s CoreLogic Case-Shiller 20-city home price index, released Tuesday.

For the top 20 markets, prices increased 5.1 percent in June compared with a year ago. That’s down from a 5.3 percent annual gain in May and is the slowest year-over-year pace since last August.
Portland, Seattle and Denver have topped the list of price gains for the past five months. From May to June, Seattle prices rose 1.4 percent, again trailing only Portland at 1.6 percent.

Home values have slowed to more sustainable rates elsewhere. In Northeastern cities such as New York and Washington, D.C., they are rising at roughly the rate of inflation, and in Boston, less than 5 percent.
Still, nationwide prices are increasing more quickly than incomes as buyers compete for the dwindling supply of available homes. That reflects an ongoing imbalance in the housing market that could stifle sales in the coming months.

“June represents the fifth straight month of flat or decreasing year-over-year price gains, but homebuyers are still being challenged as prices outpace income growth,” Ralph McLaughlin, chief economist at real estate data provider Trulia, said.

Cities in the Midwest were mixed. Over 12 months, home prices in Cleveland and Chicago rose 2.5 percent and 3.3 percent, respectively, while in Minneapolis they climbed 5.1 percent, the same as the nationwide pace.

Southern cities saw stronger price gains. They rose 8.9 percent in Dallas, 7.9 percent in Tampa, and 5.8 percent in Atlanta.

“Nationally, home prices have risen at a consistent 4.8 percent annual pace over the last two years without showing any signs of slowing,” said David Blitzer, managing director at S&P Dow Jones Indices. 

The 20-city price index plunged after the housing bubble started to burst in 2006, plummeting by more than a third before prices began to rise again in March 2012. In June, they were still 8.1 percent below their peak level.

The Case-Shiller index covers roughly half of U.S. homes. The index measures prices compared with those in January 2000 and creates a three-month moving average. The June figures are the latest available.

Seattle Times business staff contributed to this report