A sign that the U.S housing market might be on the road to recovery is a rise of the Home price index in 20 metropolis city’s. In the month of May the H.P.I rose up too 2.2%. For the second month in a row the housing market is slowly trickling back to what could be a full blow recovery.
The rise of the 2.2% in S&P/Case-Shiller H.P.I beat most “economists” forecast, as 20 of the nation’s largest metropolitan areas posted gains from April. Among those notable Atlanta is up to 4.0% in 2012 as opposed to -14.5% in 2011, Los Angeles up 2.2% from 2011’s -2.0%. “We have observed two consecutive months of increasing home prices and overall improvements in monthly and annual returns,” says David M. Blitzer, Chairman of the index committee at S&P Dow Jones Indices. “However, we need to remember that spring and early summer are seasonally strong buying months, so this trend must continue throughout the summer and into the fall.”
According to the forecast by Bank of America Merrill Lynch and other economists, housing is expected to help stimulate the economy’s growth.
The price of housing fell 35% from their peak also losing more than two million construction jobs since 2007, and that includes 455,000 in residential construction, half of the industry’s total. Merrill’s forecast says housing prices will be close to flat this year and next, with mid-single-digit nationwide gains emerging by mid-decade.
“Investor money has come in to some of the hard-hit markets like Phoenix and Florida cities,” said Mike Larson, a real estate analyst with Weiss Research.
That has helped stabilize housing by shrinking inventory.