Housing prices on the upswing in Twin Cities

Twin Cities housing prices are making a comeback.

The Case-Schiller Index, which tracks the resale price of homes, shows an impressive 3.14% increase for June. That’s the largest one-month jump in prices since the national survey started including the Minneapolis area in 1989. It’s also the first back-to-back increase in home resale prices since last summer.

Prices are still 19.8 percent lower than a year ago, and 5.7 percent lower than the beginning of the year.

Only two other cities — Cleveland and San Francisco — had a bigger upswing:

Here’s the spreadsheet from the Case-Schiller survey.

Meanwhile, Teresa Boardman, who writes the St. Paul Real Estate blog, has done her numbers-crunching thing for St. Paul and finds things are looking up:

Buyers are writing offers. The market is becoming more balanced. In 2007 it seemed like everyone wanted to sell and no one wanted to buy and the inventory of homes on the market kept rising. This year the inventory of homes for sale is much lower than in 2007 or 2008 and it continues to drop. There are currently 1611 homes on the market, or about half as many as there were last August. At the same time almost twice as many homes sold in July of 2009 when compared with July of 2008.

The big economic news today, of course, is President Barack Obama’s decision to nominate Ben Bernanke for another term as head of the Federal Reserve Board. Good? Bad? You’ll want to listen to today’s first hour of Midmorning on MPR (Archived audio here).

David Wessel, economics editor for The Wall Street Journal and author of “In Fed We Trust,” argued that there were times during the financial collapse when the Fed acted as a fourth branch of government.

“If we were attacked by a foreign power, and the president of the United States has the ability and power to fire back missiles, the president of the United States does not have billions of dollars in his pocket to save the financial system. Only the Federal Reserve has that,” he said.