Asking Home Prices May Be Softening in Line with Employment

Wednesday, 06 Jun 2012 10:16 AM

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Asking home prices may be softening in line with the country's deteriorating jobs market, according to a new report from real estate sales site Trulia.com.

After posting gains over two months, asking prices on homes up for sale — a two-month leading indicator — were unchanged in May, Trulia.com data show, CNBC reports.

Monthly jobs reports, meanwhile, have been getting worse as well.

The economy added a net 69,000 nonfarm payrolls in May, well below expectations, while April picked up 77,000 jobs.

By comparison, January and February added 275,000 and 259,000 net jobs, respectively.

"Asking prices and employment both stagnated in May, yet one more reminder that the housing recovery depends on job growth," says Jed Kolko, Trulia’s chief economist, CNBC adds.

"The metros where prices rose the most have stronger demand from faster job growth and tighter supply from fewer foreclosed homes on the market."

Sales are showing some signs of recovery in parts of the U.S., but prices remain weak.

Average home prices in March fell 2.6 percent from a year earlier, according to the S&P/Case-Shiller home price index of 20 major markets, bringing home prices down to 2002 levels.

February home values fell 3.5 percent.

The sector may be bottoming out, but is far from surging ahead.

"We’ve turned the corner," says Scott Brown, chief economist at Raymond James & Associates in St. Petersburg, Florida, Bloomberg reports.

"This was always going to be a very gradual process. No one expected a real sharp housing recovery."


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