National home prices in May came in 6.8 percent higher than a year earlier, according to a ""Clear Capital study"":http://www.clearcapital.com/company/MarketReport.cfm?month=June&year=2010 released Thursday. It's the largest annual increase recorded by the California-based real estate valuation firm since July 2006.
May's gains followed the back-to-back 5.1 percent yearly gains achieved in March and April. Clear Capital also noted that the rolling quarter-over-quarter home price change of -1.8 percent in May is a ""substantial improvement"" over last month's reported -5.0 percent quarterly variance.[COLUMN_BREAK]
""We continue to see sustained price growth throughout much of the country with yearly price gains reflecting the housing recovery off of last year's lows,"" said Dr. Alex Villacorta, senior statistician for Clear Capital.
Villacorta says it is interesting to note, however, that this current momentum is a far cry from where we were a year ago.
""In June of last year, we reported a national yearly decline of 19.3 percent, whereas the present report shows a 6.8 percent gain,"" Villacorta explained. ""This dramatic shift in price trends reflects the unprecedented volatility over the last couple of years and the delicate state of local real estate markets around the country.""
Villacorta also noted that the expiration of the federal homebuyer tax credit at the end of April has been a strong contributor to price growth. He expects markets across the country to continue to see strengthening of prices as more sales close before the June 30 closing deadline for the tax break.
Like the divergent price trends from a year ago, Clear Capital also notes that the present REO saturation rate of 27.8 percent is a significant improvement from last year's 41.7 percent.