Home prices kept climbing in California’s major urban areas in July, said a key real estate index released Tuesday.
Prices in Los Angeles and Orange counties were up 6.1% compared with a year earlier, according to the S&P CoreLogic Case-Shiller Indices. That’s a steeper increase than nationwide prices, which climbed 5.9%, led by growth in the Pacific Northwest.
San Diego County home prices, meanwhile, jumped 7.1%, and San Francisco climbed 6.7%.
The price increases might show growth, but other indicators hint the nation’s housing market may be slowing down, along with other major purchases, David Blitzer, managing chairman of the Index Committee at S&P Dow Jones Indices, wrote in the monthly report.
Sales of new and existing homes are down since last March, and sales of automobiles — the second-largest consumer purchase in the United States behind homes — peaked in November, he wrote.
Economist Felipe Chacon of housing website Trulia said the price increases are a reflection of low home inventory across the nation.
Low inventory, he said, “has been the chronic problem that keeps getting worse.”
Also spurring prices to rise, Chacon said, are a strong economy, low unemployment, historically low mortgage rates, and people feeling they are in a good position to buy homes.
Seattle had the biggest year-over-year price increase at 13.5%, followed by Portland, Ore., at 7.6% and Las Vegas at 7.4%. The slowest risers were Chicago and Washington, D.C., both with 3.3% increases.
The nationwide 5.9% increase in July was slightly faster than June’s 5.8% rise, and it beat the expectations of economists for Bloomberg, who predicted a climb of 5.7%. The indices are adjusted for seasonal swings.
Blitzer predicted the nationwide housing market would be affected by rebuilding in Texas, Florida and other parts of the nation damaged by recent major storms. He said the market also could be affected by the Federal Reserve’s decision to shrink its multitrillion-dollar bond portfolio, which may cause mortgage rates to rise.