Portland-area home prices rose 3.6 percent in May compared with the same month a year earlier, the data firm CoreLogic reported. Across the country, prices are up 2.0 percent in the same period. The company said in a statement the gains -- the third month showing appreciation on an annual and month-to-month basis -- are an encouraging sign the housing market has reached its bottom.
Increased prices across the country can be attributed to tighter inventories of homes for sale, particularly in some of the hardest-hit markets. Phoenix, one of the markets most overstocked with newly built homes after the housing crash, showed a 14.7 percent increase in prices between May 2011 and May 2012.
In Portland, increases in the selling prices of homes in foreclosure contributed to overall gains. Such "distressed properties," which often sell for a discount compared with properties not in foreclosure, typically weigh down prices and obscure gains made elsewhere in the market. But in May, the year-over-year increase in prices was 0.2 percentage points higher than if distressed properties were excluded.
That's likely because the greatest demand is in the less expensive end of the market, where first-time homebuyers and investment buyers are competing.
"Home price appreciation in the lower-priced segment of the market is rebounding more quickly than in the upper end," CoreLogic economist Mark Fleming said in the company's statement. "Home prices below 75 percent of the national median increased 5.7 percent from a year ago, compared to only a 1.8 percent increase for prices 125 percent or more of the median."
Based on pending sales that haven't yet closed, the company said nationwide home prices will rise by 1.4 percent from May to June.
In an earlier report, the Regional Multiple Listing Service reported the Portland area's median home price was $281,400 in May, 6.6 percent higher than a year earlier.
Published: Monday, July 02, 2012, 10:42 AM Updated: Monday, July 02, 2012, 5:18 PM By Elliot Njus, The Oregonian