Home prices held steady from a year earlier in June as high mortgage rates kept both buyers and sellers on the sidelines.
The S&P CoreLogic Case- Shiller National Home Price Index, which measures home prices across the nation, was unchanged year-over-year in June, compared with a 0.4% annual decrease the prior month.
On a month-over-month basis, the index rose a seasonally adjusted 0.7% in June, the fifth straight monthly increase. Mortgage rates surged last year, making home purchases less affordable and pushing many buyers out of the market.
But home prices only fell a small amount on a national basis and are now starting to tick higher again. The very low inventory of homes for sale has supported prices, as homeowners with low fixed mortgage rates are unwilling to sell.
“While home prices fell year-over-year in June, prices may have turned a corner,” said Lisa Sturtevant, chief economist at Bright MLS. “For months, home prices have continued to rise even with elevated mortgage rates because supply has been so limited.”
The Case-Shiller index, which measures repeat-sales data, reports on a two-month delay and reflects a three-month moving average. Homes usually go under contract a month or two before they close, so the June data is based on purchase decisions made earlier this year.
The median existing-home sale price rose 1.9% in July from a year earlier to $406,700, according to the National Association of Realtors.
The Case-Shiller 10-city index fell 0.5% over the year ended in June, following a 1.1% decline in May. The 20- city index fell 1.2%, compared with a 1.7% decline in May.
Economists surveyed by The Wall Street Journal expected the 20-city index to decline 1.5%. Chicago had the fastest annual home-price growth in the country, at 4.2%, followed by Cleveland, at 4.1%.
The weakest market was San Francisco, where prices fell 9.7% on an annual basis. A separate measure of home-price growth by the Federal Housing Finance Agency also released Tuesday found a 3.1% increase in home prices in June from a year earlier.
The FHFA index rose 0.3% in June from the prior month on a seasonally adjusted basis.
Source: Wall Street Journal