Home prices rise 5.7% in Jan: S&P/Case-Shiller

Case-Shiller National Index up 5.7% versus 1 year ago
Case-Shiller National Index up 5.7% versus 1 year ago   

Home price appreciation in major U.S. metropolitan areas in the first month of the year kept pace with recent gains as inventory remained low, S&P Dow Jones Indices reported Tuesday.

The S&P/Case-Shiller 20-City Composite Index rose 5.7 percent in January from the previous year, roughly in line with expectations.

"Home prices are rising very rapidly — twice the rate of inflation. There is very, very little supply. There is four to five months supply in the market right now, which is quite low," David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, told CNBC's "Squawk on the Street."

Despite a bump in single-family home construction in February, the country is still not building enough new residences, the segment of housing that drives the economy, he added.

Financing continues to be a concern, particularly for young, first-time homebuyers, Blitzer added.

Zillow Chief Economist Svenja Gudell said lower-income buyers are having a tough time finding a home that matches their needs and budgets, but there is not much to worry about in housing when one looks at the big picture.

"Economic growth hasn't been overwhelming, but it has been consistent, and as long as wages and job opportunities keep rising, the housing market should remain fairly stable and healthy," she said in a statement.

Price appreciation in the top cities came in above the previous month's gains. Portland, Oregon, saw home values increase 11.8 percent, compared with 11.4 percent in December. Seattle and San Francisco followed with 10.7 percent and 10.5 percent increases, respectively, both besting growth in December.

The S&P Case-Shiller U.S. National Home Price Index, which measures all nine U.S. census divisions, was up 5.4 percent year over year in January.