US house prices rise, consumer confidence up
The US economy experienced two sets of positive economic data today. Firstly, the Standard & Poor’s/Case-Shiller composite index of 20 metropolitan areas rose for the sixth consecutive month in November.
According to the index, house prices were 0.2% higher compared with the October.
Meanwhile, on an annual basis, the 20-city index was 5.3% down compared with November 2008.
David Blitzer, chairman of S&P’s index committee, comments: “On balance, while these data do show that home prices are far more stable than they were a year ago, there is no clear sign of a sustained, broad-based recovery.”
On a regional basis, San Francisco, San Diego and Los Angeles saw prices rise but Charlotte, Las Vegas, Seattle and Tampa continued to see falls in November – each hitting all-time lows.
Joshua Shapiro, chief US economist at MFR, added: “While much of the impact of the sub-prime disaster on prices at the bottom end of the market may well be behind us, there is likely plenty of pain yet to come further up the price spectrum.”
In the meantime, consumer confidence in the US rose for the third consecutive month in January – its highest level in over a year.
The closely-watched US Conference Board‘s Consumer Confidence Index rose to 55.9 in January, up from 53.6 in December.
A level of 50 on the Confidence Index is the minimum to indicate a healthy economy.
Commenting on the figures, Lynn Franco of the Conference Board, said: “Consumers’ short-term outlook, while moderately more positive, does not suggest any significant pickup in activity in the coming months.”
The figures are closely monitored because consumer spending makes up for more than two-thirds of overall economic activity in the US.
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