Twin Cities home prices up 11% in October
Twin Cities home prices were up about 11 percent in October compared to the same month last year, according to the closely watched S&P/Case-Shiller Home Price Index.
The Twin Cities increase was just below the 14 percent October-to-October gain calculated for the nation's 20 major metropolitan areas.
While the double digit increases are impressive, many housing experts say that trend can't continue.
David Blitzer, chair of the index committee at S&P Dow Jones Indices, said he expects to see weaker price gains in the Twin Cities and other big markets in the coming year.
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That's not a bad thing, he added.
"I do think double digit growth in home prices doesn't happen very often and is really not that sustainable over the long period," he said. "We tried that about six years ago and the results weren't too pretty."
Home prices will moderate in 2014 partly due to lower demand for housing. The Federal Reserve will likely continue to taper its bond-buying program in 2014 and that could push up interest rates and slow demand for mortgages, he added.
Even as housing softens a bit, Blitzer said he expects other parts of the economy will pick up.