The latest housing information indicates that home prices have continued to make a slow and steady recovery. That's good news for the economy in general, and specifically could help homeowners and depositors in savings accounts. However, it should be a call to action for potential home buyers, who otherwise could miss a rare opportunity.
The S&P/Case-Shiller Home Price Index rose in July, according to figures released on September 25. It's too early to call this a rally, but then again, an orderly recovery in the housing market may be better than a return to the runaway increases of the housing boom.
Healthier than people think?
Overall, the housing market may be healthier than many realize. The S&P/Case-Shiller Home Price Index has now increased for six consecutive months. Certainly, prices are nowhere near back to where they were during the peak of the housing boom, but that may be an unrealistic -- and unhealthy -- target.
Looking longer term, the S&P/Case-Shiller Index is up about 40 percent from where it was in January of 2000. So, if you look at the housing boom as an aberration, what you see is that housing prices have still made solid gains over the long run. Ultimately, modest price increases are much healthier for the housing market than a steep hike in prices, which can freeze many potential buyers out of the market and cause some actual buyers to get in over their heads.