Home Prices Increase in Major Cities in August-Report

 A new data from the Standard & Poor’s and Case-Shiller showed that US home price index has increased for the third straight month in August, which surprised economist who were expecting the “rapid” recovery of the housing market not to last that long.

According to the survey, the US homes prices jumped by almost seven percent, which gave the impression that the housing sector has instantly recovered from its three-year slump.

“It’s outstanding to see that the prices of US homes are increasing despite the growing unemployment rate and lesser confidence by the American consumers to spend,” economist and index co-creator Robert Shiller.“It’s unlikely to see home prices booming especially with tough times like this. It’s a time of exceptional uncertainty and yet it is happening,” he added.

Also the chief economist said that the prices of new housing in the US will continue to increase in the following months. However, he said that there is still the big question on whether the housing sector can keep up with its pricing.
“It’s unbelievable and there’s no way any statistician can predict anything about this,” he said.

According to Shiller, some 20 major cities in the US have raised their home prices by around one percent from July to August, to a seasonally adjusted reading of 144.6. It was downed by more than 11 percent at the same period last year.

With the spike in home prices, the consumers will have the perception that the economy has already rebuilt itself since they are aware that they can now buy more expensive properties. The rise in the price of house will also give homeowners to ask for more value to their properties to banks where they owed money.