April 25, 2017 / 1:16 PM / 3 months ago

U.S. home prices rise faster than expected in February

2 Min Read

The New York City Housing Authority Housing Developments on the Lower East Side (bottom C) is seen in New York, in this October 26, 2009 file photo.Shannon Stapleton/Files

NEW YORK (Reuters) - U.S. single-family home prices accelerated at a faster pace than expected in February, supported by a low inventory of housing stock, a survey showed on Tuesday.

The S&P CoreLogic Case-Shiller composite index of 20 metropolitan areas rose 5.9 percent in February on a year-over-year basis, after an unrevised 5.7 percent increase in January. February's result topped the estimate of a 5.7 percent increase from a Reuters poll of economists and was the biggest year-on-year increase since July 2014.

David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, said the low stock of existing homes for sale - currently just 3.8 months of supply at current sales rates - is bolstering the price increases.

"Housing affordability has declined since 2012 as the pressure of higher prices has been a larger factor than stable to lower mortgage rates," he said.

On a monthly basis, prices in the 20 cities rose 0.7 percent in February on a seasonally adjusted basis, the survey showed, just shy of expectations for a 0.8 percent increase.

On a non-seasonally adjusted basis, prices increased 0.4 percent from January.

Reporting by Dan Burns; Editing by Chizu Nomiyama

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