Increase in US home prices falls short of expectations

[NEW YORK] US single-family home prices rose less than expected on an annual basis in May, and were down from the prior month, a survey showed on Tuesday.

The S&P CoreLogic Case-Shiller composite index of 20 metropolitan areas rose 5.2 per cent in May on a year-over-year basis, retreating from the 5.4 per cent climb in the prior month and short of the estimate for a 5.5 per cent increase from a Reuters poll of economists.

"Overall, housing is doing quite well," said David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices.

"In addition to strong prices, sales of existing homes reached the highest monthly level since 2007 as construction of new homes showed continuing gains."

Prices in the 20 cities fell 0.1 per cent in May from April on a seasonally adjusted basis, the survey showed, matching expectations for a decline of 0.1 per cent.

On a non-seasonally adjusted basis, prices increased 0.9 per cent from April.

Home prices in three US cities - Denver, Seattle and Portland, Oregon - showed the highest year-over-year gains, the survey showed.

REUTERS