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 % in November on a year-over-year basis, up from a 5.1 % climb in October. November's result topped the estimate of 5.1 % 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 % in November after an upwardly revised 0.7 % in October on a seasonally adjusted basis, the survey showed, outpacing expectations for a 0.7 % increase.
On a non-seasonally adjusted basis, prices increased 0.2 % from October, in-line with expectations.