The latest monthly Standard & Poor's/Case-Shiller home price index came in higher last week. Prices were up in 12 of the 20 major markets that Case Shiller monitors. Home price indexes increased nationwide in August, including in South Florida where an S&P Case-Shiller report released today showed a 1.1 percent step up. The index does include all single family homes sold, which may account for any difference between it and National Association of Realtor figures released last week that showed a small dip in local median home prices. The NAR looks at MLS listings only.
The Commerce Department released parallel findings last week - that consumers are finally beginning to loosen up on spending, and are making purchases they deferred during the scary months of 2009. If that rate of expansion in consumption continues, not only will it begin to whittle away at the unemployment rate, but also stimulate the entire US economy, since consumer spending accounts for 70 percent of the national gross domestic product or GDP. The housing and mortgage sectors could also begin to show some of that confidence and willingness to spend.
Home sales are expected spike upwards in the coming several months as the two federal housing tax credits head for expiration. Mortgage Bankers Association reported last week that applications for new loans to buy houses - a bellwether indicator - jumped by seven percent and now stand at their highest level in six months.