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US home prices continued to rise in early 2017, with January marking the fifth consecutive month of record setting highs. January’s gains not only topped the previous four months, but also hit a 31-month high, according to new data from the S&P CoreLogic Case-Shiller Indices.

The monthly indices are produced by S&P Dow Jones and CoreLogic, and cover all of the US Census divisions. The indices measure the value of homes, and there are four different indices: a national home price index, a 20-city composite index, a 10-city composite index, and 20 individual metro area indices.

The S&P CoreLogic Case-Shiller Home Price Indices are calculated monthly using a three-month moving average. The National Home Price Index tracks the value of single-family housing within the US. The index is a composite of single-family home price indices for the nine U.S. Census divisions, and it is calculated quarterly. The indices all had a base value of 100 in January 2000, so a current index value of 150 equates to a 50 percent appreciation rate since January 2000 for a typical home located within the subject market.

The latest data from the national indices showed a nearly 6 percent annual gain in January, up from the 5.7 annual gain recorded in December 2016. January’s gain placed the National Home NSA Index at its highest level in 31 months — 185.51, according to Case-Shiller.

The 10- and 20-city indices both recorded annual gains in January, up 5.1 percent and 5.7 percent respectively — compared to 4.8 percent and 5.5 percent annual growth recorded in December 2016.

Seattle, WA, Portland, OR and Denver, CO recorded the largest year-over-year gains over each of the last 12 months. Seattle recorded an 11.3 percent annual price increase, while Portland and Denver recorded annual price gains of 9.7 percent and 9.2 percent respectively.

Additionally, 12 cities recorded higher price gains in the year ending January 2017 compared to the year ending December 2016, says Case-Shiller data.

The National Index recorded a 0.2 percent gain from the previous month in January before seasonal adjustment. Meanwhile, the 10-city composite recorded a month-over-month gain of 0.3 percent, and the 20-city composite recorded a 0.2 percent month-over-month gain in January. Thirteen of the 20 cities recorded increases in January before seasonal adjustment.

After seasonal adjustment, the National Index recorded a 0.6 percent gain from the previous month in January. Both the 10-city and 20-city composites recorded monthly gains of 0.9 percent in January. Nineteen cities recorded gains after seasonal adjustment.

“Today’s data showed continued growth in home prices, but don’t account for the millions of home shoppers nationwide who pushed the start of their home shopping efforts into February and early March, hoping to get a jump on their competition in the face of persistently low inventory,” said Zillow’s chief economist Svenja Gudell, in a research note on the Case-Shiller data.

He added that high demand for housing and tight inventory will continue to drive competition in the coming months. Gudell also pointed to looming mortgage rate hikes as a potential influence on the market in the coming year.

“Rising rates may cool rapid home price growth – especially in more-expensive coastal markets – but will also dent overall home affordability. But rates are rising slowly and what inventory is available continues to fly off the shelves. Nobody should expect these overall market forces to shift meaningfully overnight,” Gudell said.

Click here to read the entire report.

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