Q2 home prices rise 1.7% nationwide

The average price of homes bought with mortgages funded by Freddie Mac rose 1.7 percent during the second quarter and for the first time in two years there were gains in every part of the U.S.

The quarterly increase followed a 1.5 percent drop during the first quarter, according to a report today from the McLean, Virginia-based mortgage buyer. Measured from a year earlier, home prices fell 6.7 percent, slower than the first quarter’s 8.5 percent annual decline.

Demand is returning to the U.S. housing market after a three-year slump cut values nationwide and led to record foreclosures. The number of contracts to buy previously owned homes rose more than forecast in July and increased for a record sixth consecutive month, reinforcing signs that the housing market is steadying.

“The pickup in home price growth rates is consistent with other housing market indicators that show home sales and single- family construction up in the second quarter,” said Frank Nothaft, Freddie Mac vice president and chief economist, in a statement.

SOURCE: BLOOMBERG