“Sales of both new and existing homes, housing starts and the National Association of Home Builders' sentiment index are all trending higher,” Blitzer points out. NAHB announced earlier this month that its broader National Association of Home Builders/Wells Fargo Housing Market Index rose two points in May to reach 70, its second highest post-downturn showing. Conversely, NAHB's latest Multifamily Production Index was off seven points to 48 in the first quarter of 2017, the index's first reading under 50 since 2011.

“Volatility in the tax credit market is already having a detrimental effect on the production of affordable rental properties, most of which need to be financed with tax credits,” said Dan Markson, SVP of the NRP Group in San Antonio, TX and chairman of NAHB's Multifamily Council. “However, developers of market-rate properties in many parts of the country remain reasonably optimistic.”

Over the past year, says Blitzer, “analysts suggested that one factor pushing prices higher was the unusually low inventory of homes for sale. People are staying in their homes longer rather than selling and trading up.

“If mortgage rates, currently near 4%, rise further, this could deter more people from selling and keep pressure on inventories and prices,” he continues. “While prices cannot rise indefinitely, there is no way to tell when rising prices and mortgage rates will force a slowdown in housing.”

NEW YORK CITY—Led by a quartet of markets west of the Mississippi, home prices posted their strongest annual gains since 2014, S&P Dow Jones Indices said Tuesday. The latest results for the S&P CoreLogic Case-Shiller Indices, reflecting market performance for March, showed the National Home Price NSA Index up 5.8% from a year ago and the 20-Cty Composite Index up 5.9%. Analysts polled by Thomson Reuters had expected a 5.9% annual increase for the NSA Index.

As measured by the NSA Index, which covers all nine US census divisions, home prices are now 1.3% above the 2006 peak and 39.5% above the 2012 trough. Looking at the 10- and 20-City composites, though, there is still room to run for individual markets, with the 10-City Composite still off 7.6% from the prior peak and the 20-City falling short by 5.4%.

“While there is some regional variation, prices are rising across the US,” says David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices. “Half of the 20 cities tracked by the S&P Corelogic Case-Shiller indices rose more than 6% from March 2016 to March 2017. The smallest gain of 4.1%, in New York, was roughly double the rate of inflation.”

The best posting among individual markets was Seattle's 12.3% year-over-year price increase, followed by Portland with 9.2%, Dallas with an 8.6% increase and Denver with 8.4%. Tier level analysis from 2011 to the present shows both Seattle and Portland's housing prices in the high tier to be the most stable while housing prices in the low tier are most volatile.

“Sales of both new and existing homes, housing starts and the National Association of Home Builders' sentiment index are all trending higher,” Blitzer points out. NAHB announced earlier this month that its broader National Association of Home Builders/Wells Fargo Housing Market Index rose two points in May to reach 70, its second highest post-downturn showing. Conversely, NAHB's latest Multifamily Production Index was off seven points to 48 in the first quarter of 2017, the index's first reading under 50 since 2011.

“Volatility in the tax credit market is already having a detrimental effect on the production of affordable rental properties, most of which need to be financed with tax credits,” said Dan Markson, SVP of the NRP Group in San Antonio, TX and chairman of NAHB's Multifamily Council. “However, developers of market-rate properties in many parts of the country remain reasonably optimistic.”

Over the past year, says Blitzer, “analysts suggested that one factor pushing prices higher was the unusually low inventory of homes for sale. People are staying in their homes longer rather than selling and trading up.

“If mortgage rates, currently near 4%, rise further, this could deter more people from selling and keep pressure on inventories and prices,” he continues. “While prices cannot rise indefinitely, there is no way to tell when rising prices and mortgage rates will force a slowdown in housing.”