In a notable development in the real estate sector, US home prices surged to a "new all-time high" for June, even as the rate of growth experienced a slowdown both sequentially and on an annual basis. According to data released by S&P Global's S&P Dow Jones Indices on Tuesday, the national S&P CoreLogic Case-Shiller Index registered a modest increase of 0.2% in June after seasonal adjustments.
This marked a deceleration from a 0.3% uptick recorded in May. The 10- and 20-city composite indices demonstrated growth rates of 0.5% and 0.4%, respectively, mirroring the rates seen in the previous month. Annual comparisons reveal that home prices on a national level climbed by 5.4% in June, a dip from the 5.9% yearly increase noted in May.
Meanwhile, the 10-city index saw an annual rise of 7.4%, a drop from 7.8% in May, while the 20-city composite index rose by 6.5%, down from 6.9% the month prior. Brian Luke, head of commodities, real and digital assets at S&P Dow Jones Indices, commented on the findings, stating, "The S&P CoreLogic Case-Shiller Indices continue to show above-trend real price performance when accounting for inflation.
Home prices and inflation continue to factor into the political agenda coming into the election season." Among the 20 metropolitan areas tracked, New York exhibited the most significant annual price increase in June, soaring by 9%. This was closely followed by San Diego with an increase of 8.7%, and Las Vegas at 8.5%.
Conversely, Portland maintained the lowest ranking, with only a marginal rise of 0.8% in prices. Luke further elaborated, "While both housing and inflation have slowed, the gap between the two is larger than historical norms, with our national index averaging 2.8% more than the consumer price index." In a separate report, the Federal Housing Finance Agency (FHFA) indicated that home prices experienced a slight decline of 0.1% on a seasonally adjusted basis in June, following a stable reading from May.
The market consensus had anticipated a 0.1% increase based on a survey by Bloomberg. On an annual basis, home prices saw a 5.1% increase in June. Additionally, the FHFA reported that house prices during the second quarter rose by 5.7% compared to the same period last year, reflecting a 0.9% increase from the first quarter.
Anju Vajja, deputy director for the FHFA's division of research and statistics, noted, "US house prices have seen the third consecutive slowdown in quarterly growth. The slower pace of appreciation as of the end of June was likely influenced by higher inventory of homes available for sale and elevated mortgage rates." Here's a quick look at the price data: Price: 504.93, Change: +3.82, Percent Change: +0.76.