The Twin Cities fared exceptionally well during July, according to the closely watched Case Shiller house price index. Year-over-year prices during July were up more than 6 percent, far outpacing a 20-city composite that showed an increase of 1.2 percent. The Twin Cities was bested only by Phoenix, which saw a 16.6 percent increase. That double-digit jump for Phoenix is primarily a reflection of just how far prices had fallen in that market.
Case Shiller said that month-to-month prices were up in all 20 regions tracked by the report and it was the second month of year-over-year increase for the index - that's something that hadn't happened for two years.
No doubt the report will help bolster confidence that the housing market is on the mend, and by some measures it's considered one of the most accurate measures of what's happening in the market because it tracks repeat sales of the same house based on public records and does not include foreclosures, but critics say that the report isn't the most timely reflection of what's happening because it's based on a rolling three-month average.
Aside from record-low mortgage rates, prices are being lifted by tight inventories and steady declines in the number of foreclosure sales. On Monday the Minneapolis Area Association of Realtors weekly market update showed that overall inventories had fallen to new lows and this morning CoreLogic said that the foreclosure rate in the Twin Cities had fallen .42 percent to 1.62 percent during July. That's below a national average of 3.25 percent.