The U.S. housing market remains strong, despite a slowdown in the economic recovery. The S&P/Case-Shiller seasonally-adjusted national home price index rose by 4% during the year to Q2 2016 (inflation-adjusted).
Global Property Guide’s detailed analysis of the U.S. housing market shows that House prices increased by 1.89% during the latest quarter. The Federal Housing Finance Agency's seasonally-adjusted purchase-only U.S. house price index, rose by 4.34% during the year to Q2 2016 (inflation-adjusted), and was almost unchanged in Q1 2016 from the previous quarter.
House prices continue to rise in all 20 major U.S. cities, according to the Case-Shiller index, with Portland registering the biggest inflation-adjusted increase of 11.4% year-on-year in Q2 2016, followed by Seattle (9.9%), Denver (8.1%), Dallas (7.9%), Tampa (6.9%), Miami (5.8%), San Diego (5.4%), San Francisco (5.4%), Atlanta (4.8%), and Las Vegas (4.6%).
Washington and New York saw the lowest growth in house prices, at 1%.
Residential construction continues to rise modestly. New privately-owned housing units authorized rose by 0.9% y-o-y in July 2016, according to the U.S. Census Bureau, and housing starts rose by 5.6%, while completions rose by 3.2% to 1,026,000 units.
Demand is surging. New house sales were up by 31.3% to a seasonally adjusted annual rate of 654,000 units in July 2016 from the same period last year, according to the U.S. Census Bureau. There were about 233,000 units for sale by July 2016, about 8.4% up from a year earlier.
Homebuilders remain bullish, amidst a shortage of existing homes for sale. U.S. home builder sentiment stood at 60 in August 2016, up from 58 in July, 60 in June, and 58 in May 2016, according to the National Association of Home Builders. A reading of 50 is the midpoint between positive and negative sentiments.
In the second quarter of 2016, the U.S. economy grew by a lower-than-expected annualized rate of 1.2%, after growth of 0.8% in Q1 2016, 1.4% in Q4 2015, 2% in Q3 2015, 3.9% in Q2 2015 and 0.6% in Q1 2015, with exports and investment weaker because of the strong dollar and lower oil prices, according to the U.S. Bureau of Economic Analysis. Despite this, the U.S. economy grew by 2.4% last year, matching its pace in 2014. The world's largest economy is expected to grow by just 2% this year.
For the latest detailed housing market analysis of individual regions and countries, check out the Global Property Guide's global survey for Q2 2016.