Housing prices rose in August as inventory continued to shrink across the nation, anther sign that the sector’s recovery is gathering steam.
Prices were up 0.7 percent on a seasonally adjusted basis in August, while the 0.2 percent July increase was revised downward to 0.1 percent, the Federal Housing Finance Agency reported Tuesday night, accidentally sent out ahead of Wednesday’s scheduled release.
Prices are up 4.7 percent in the past year. The index is 15.9 percent below its April 2007 peak and is about the same as the June 2004 level.
For the nine census divisions, monthly price changes in August ranged from a drop of 0.5 percent in the East South Central division to an increase of 3 percent in the Pacific.
The housing sector is on the mend and there is greater confidence that after years of struggles, the market has turned the corner.
Despite the housing sector’s primary role in the financial crisis and its drag on the recovery, neither President Obama nor Republican hopeful Mitt Romney has seized on the issue.
Obama hit on the topic a couple of times in the past week, calling on Congress to pass a bill that would provide homeowners who are under water on their mortgages an easier path to refinancing into lower-rate mortgages.
The Senate is scheduled to take up a bill when Congress returns after the election.
Rising prices, improved consumer and builder confidence, a four-year high in housing construction and historically low mortgage rates are bolstering the market’s gradual recovery.
However, the market still faces significant hurdles from continued fiscal uncertainties, lack of credit for builders and potential homebuyers, inaccurate appraisals and the number of seriously delinquent mortgages still in the system.