Home Price Increases Vary By Location

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Asking prices lead actual home sales prices by a month or two. And, because of this, they are a good indicator of where home prices are headed. According to Trulia’s most recent Price Monitor – which measures asking prices on a monthly, quarterly, and yearly basis – prices rose just 1 percent in August. The slight increase is in keeping with recent trends showing home prices rising at an ever slowing pace. The rate at which prices are rising, depends a lot on location. For example, prices are rising in the South at a faster rate than they are in the Northeast. In fact, seven of the top 10 metros with the largest year-over-year gains are in the South. Price increases, to some extent, are also influenced by how hard your local market was hit by the foreclosure crisis. In areas where there were a lot of foreclosures, home values fell farther faster. But as those foreclosures sold, prices naturally went up, since foreclosures usually sell at a discount. That means, areas that cleared their foreclosure inventory faster saw price increases earlier. Now, those markets are beginning to slow down. Areas that took longer to sell off their foreclosed inventory, on the other hand, are now beginning to see sharp price increases. More here.