The price of homes in 20 US cities rose in August marking the third straight month of increases and providing further support to the idea that a recovery is in the works. The S&P/Case-Shiller home index rose 1 percent for the month after a 1.2 percent increase in July.
Part of the increase is undoubtedly due to government programs including the first-time buyer plan combined with low interest rates. Also, home prices are still depressed after the credit collapse led to a record rate of foreclosures in many states and it is only now that prices appear to have stabalized.
“Home prices are coming around,” John Herrmann, president of Herrmann Forecasting in Summit, New Jersey, said before the report. “Demand is picking up. Step by step, the housing recovery will contribute to growth.”
