Home prices continued to climb in June. The S&P CoreLogic Case-Shiller national home price index rose 5.4% annually to a reading of 325.23 in June, according to data released Tuesday.
While prices continue to climb on a year-over-year basis, June’s figure was down from 5.9% growth in May. June’s annualized increase is the lowest rate of home price appreciation since November 2023.
“It is still remarkable given the fact that home prices are at record highs and, in June, mortgage rates were still around 7%,” Bright MLS chief economist Lisa Sturtevant said in a statement. “Mortgage rates have fallen since June, but there is evidence that even the decline in rates has not been enough to bring buyers back into the market. Some buyers are waiting for home prices — and not just interest rates — to come down.”
The 20-city and 10-city composite indexes also posted annualized gains, rising 6.5% and 7.4%, respectively. Each of these metrics were down compared to May, when the respective growth rates were 6.9% and 7.8%. Month over month, the national index rose 0.5%.
Among the 20 cities analyzed, New York posted the highest annualized gain of 9% for an index reading of 312.13. It was followed by San Diego (449.24) and Las Vegas (298.71) with yearly increases of 8.7% and 8.5%, respectively.
At the other end of the spectrum, Portland, Oregon (332.29) yet again held the lowest rank with an 0.8% annual increase in June.
Looking ahead to the fall, the Case-Shiller index will play a role in politics as the presidential election heats up, said Brian D. Luke, the head of commodities, real and digital assets for S&P Dow Jones Indices.
“Home prices and inflation continue to factor into the political agenda coming into the election season,” Luke said in a statement. “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. That is a full percentage point above the 50-year average. Before accounting for inflation, home prices have risen over 1,100 percent since 1974, but have slightly more than doubled (111%) after accounting for inflation.”
While Sturtevant expects a seasonal slowdown in home prices heading into the fall and winter, she does not see evidence that there will be a major home price drop in 2024.
“Inventory should also increase, which will help move the market toward more balance and slow upward pressure on home prices,” Sturtevant said. “Some local markets, where prices surged during the pandemic and where inventory is rising quickly, could see year-over-year price declines. But in most markets, inventory is still low by historic standards and sellers still have the upper hand.”
