New York - UPI
Second-quarter home prices rose by their largest percentage in at least seven years, pushed by low inventories and high demand for foreclosed properties.
Prices rose by 2.5 percent in June from a year ago, and by 6 percent from the previous quarter, reported CoreLogic Inc., a Santa Ana, Calif., data firm, which said the quarterly jump was the greatest since 2005.
Freddie Mac said home prices during the second quarter rose by 4.8 percent from the previous quarter, which it said was the largest jump since 2004.
The Wall Street Journal said Wednesday the key force behind the gains seemed to be a shortage of homes for sale, reporting that the number of properties on the market was less than a year ago despite an increase in demand because of low interest rates.
Prices are rising because \"there\'s not enough supply, given higher levels of demand,\" Ivy Zelman, chief executive of research firm Zelman & Associates, told the Journal. \"With every passing month, distressed homes are being absorbed at better and better prices.\"
New home construction has been at depressed levels for years because of the number of foreclosed properties. That lack of new construction also \"has set the foundation for a snap back in pricing,\" said Michael Sklarz, president of Collateral Analytics in Honolulu.