Seattle Home Prices Edge Upward

Home prices in the Seattle metro area ticked up in February, snapping a four-month slide, even as home prices in most other cities lost ground, according to the S&P/Case-Shiller 20-city index released Tuesday.

The average price of existing single-family homes in King, Snohomish and Pierce counties inched up 0.6 percent from January, when the average price fell 0.8 percent. February’s gain was the biggest monthly gain for the Seattle area since July, which saw a 1.9 percent jump.

Over the past 12 months, the Seattle area’s home prices have risen 12.8 percent. February marked the twelfth consecutive month of double-digit annual gains, even though the market is still 17.3 percent below its July 2007 peak.

Nationally, home prices in February were flat over the month and gained 12.9 percent over the year. The housing market still shows weakness, with 13 metros’ prices down over the month and seven metros’ prices up, S&P/Dow Jones Indices said.

“Despite continued price gains, most other housing statistics are weak,” said David Blitzer, chairman of the index committee at S&P/Dow Jones Indices, in a statement.

“Five years into the recovery from the recession, the economy will need to look to gains in consumer spending and business investment more than housing,” he said. “Long overdue activity in residential construction would be welcome, but is certainly not assured.”

Tuesday’s release of Case-Shiller data for February came a day after a positive report from the National Association of Realtors – pending home sales rose in March for the first time in nine months, buoyed by more homes being listed for sale.

“The housing market is showing signs of slowing, but this was expected and is part of a broader return to normal,” said Stan Humphries, chief economist at Seattle-based Zillow, in a statement.

Among the 20 metros tracked by the Case-Shiller index, the three with the strongest monthly gains in February were San Diego, Portland and Seattle. Las Vegas and San Francisco, which had been leading other cities, showed signs of slowing in their price growth.

Cleveland and Tampa posted the largest monthly declines among the 20 metros, at 1.6 percent and 0.7 percent, respectively. Denver and Dallas are the only cities that have surpassed the price peaks of the last housing boom.

Over the year, though, all 20 metros showed price growth, many in the double-digits. West Coast cities led: Las Vegas and San Francisco recorded 23 percent annual gains; San Diego, 20 percent; Los Angeles, 18 percent.

“Homeownership still represents a good bargain for those that can afford it and can find a suitable home,” Humphries said. “But affordability issues are becoming an issue in a few markets, and those problems will only get worse as mortgage interest rates rise.”

By Sanjay Bhatt Seattle Times business reporter
Sanjay Bhatt: 206-464-3103 or sbhatt@seattletimes.com On Twitter @sbhatt