House prices in US climb 5.6pc in the 12 months to November

 
City A.M. Reporter
HOUSE prices in the US shot up by 5.6 per cent in the year to November, according to a widely-observed survey released yesterday.

Prices of American homes climbed 0.6 per cent in November, compared to the previous month, according to the Federal Housing Finance Agency (FHFA).

The FHFA compiles data from new mortgages owned or guaranteed by US home loan giants Fannie Mae or Freddie Mac, to calculate its monthly figures.

While the numbers appear to bode well for a recovery in the US housing market, tight supply is believed to be one factor behind the growing prices.

The National Association of Realtors said on Tuesday that US existing home sales dropped one per cent last month to a seasonally adjusted annual rate of 4.94m units.

Michael Gapen of Barclays Capital said yesterday that he expects prices to continue trending upwards. “The improvements in the FHFA index are very much in line with what we have seen in other home price indices recently and point toward further momentum in US house prices heading into year-end,” Gapen commented.

“We look for this momentum to continue into 2013.”