U.S. Markets

U.S. home prices increase faster than expected in November

The New York City Housing Authority Housing Developments on the Lower East Side (bottom C) is seen in New York, in this October 26, 2009 file photo. REUTERS/Shannon Stapleton/Files

NEW YORK (Reuters) - U.S. single-family home price increases accelerated at a faster pace than expected in November and rising mortgage rates coupled with potential economic growth could push them higher, a survey showed on Tuesday.

The S&P CoreLogic Case-Shiller composite index of 20 metropolitan areas rose 5.3 percent in November on a year-over-year basis, up from a 5.1 percent climb in October. November’s result topped the estimate of 5.1 percent from a Reuters poll of economists.

“The new Administration in Washington is seeking faster economic growth, increased investment in infrastructure, and changes in tax policy which could affect housing and home prices,” said David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices.

“Further gains in personal income and employment may increase the demand for housing and add to price pressures when home prices are already rising about twice as fast as inflation,” Blitzer said.

Prices in the 20 cities rose 0.9 percent in November after an upwardly revised 0.7 percent in October on a seasonally adjusted basis, the survey showed, outpacing expectations for a 0.7 percent increase.

On a non-seasonally adjusted basis, prices increased 0.2 percent from October, in-line with expectations.

Reporting by Chuck Mikolajczak; Editing by Chizu Nomiyama