Home price growth slows in June for third straight month: Case-Shiller index


Home price growth slowed again in June, but remains well above historical averages, according to the latest CoreLogic S&P Case-Shiller index. (iStock)

Annual home price growth slowed in June, marking the third consecutive month of deceleration, according to the latest CoreLogic S&P Case-Shiller index.

Home prices rose 18% annually in June, down from the 19.9% ​​annual increase in May, the report said. On a month-to-month basis, house prices rose 0.6% from May to June.

But one expert noted that the National Composite, a measure of house prices, continues to see significant gains despite the recent deceleration.

“It’s important to keep in mind that the deceleration and the decline are two totally different things, and that prices continue to rise at a steady pace,” said Craig Lazzara, managing director of S&P Dow Jones Indices, in The report. “For the first six months of 2022, in fact, the National Composite is up 10.6%. In the past 35 years, only four full years have seen such large increases.”

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This is where house prices have risen the most

The 10-city composite index, which examines home price growth in the 10 major U.S. cities, rose 17.4% annually in June, from 19.1% annually in May, according to the Case Index. -Shiller. The 20-city composite index also slowed, rising 18.6% annually in June from 20.5% annually in May.

Home prices in Tampa, Miami and Dallas posted the highest year-over-year gains in June among the top 20 cities, with annual increases of 35%, 33% and 28.2%, respectively . But only one of the 20 cities reported higher annual price increases in June compared to May.

“Market strength continues to be broadly based as all 20 cities posted double-digit price increases for the 12 months ended June,” Lazzara said. “In 19 out of 20 cases, however, the June reading was lower than the May reading, showing the impact of the deceleration regionally.”

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Home price growth is expected to continue to decelerate

In order to bring down inflation, which has been high for decades, the Federal Reserve continues to raise interest rates. But these increased rates are also slowing the housing market and driving prices down.

“We noted earlier that mortgage financing has become more expensive as the Federal Reserve raises interest rates, a process that continued when we collected our June data,” Lazarra said. “As the macroeconomic environment continues to be challenging, house prices may well continue to slow.”

At its last meeting, the Fed raised interest rates for the fifth time this year by 75 basis points, bringing the target range for the federal funds rate to 3% to 3.25%. And it is expected to continue raising rates through the end of 2022 and into 2023.

“Housing market activity has cooled markedly since mortgage rates spiked in June, leading to a broad-based slowdown in house price growth and growing concerns about a potential decline in house prices in the future. the future,” CoreLogic deputy chief economist Selma Hepp said in a statement. “According to CoreLogic HPI Forecast for June, house prices will continue to slow but not fall in most markets over the next year.”

If you want to take advantage of the value of your home before interest rates go up, you can consider a cash-out refinance. To see if this is the right option for you, contact Credible to speak with a home loan expert and get all your questions answered.

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