Home Prices Continued Strong Gains in June
The S&P CoreLogic Case-Shiller Indices, covering the entire nation, rose 5.1% in the 12 months ended in June, identical to the increase reported in May.
The 10-city index gained 4.3% from a year earlier, down slightly from 4.4% last month, and the 20-city index gained 5.1% year-over-year, down from a 5.3% increase in May.
Economists surveyed by The Wall Street Journal expected a 5.2% increase in the 20-city index.
After years of volatility, home prices have grown at a rate of around 5% for two years "without any signs of slowing," said David Blitzer, managing director at S&P Dow Jones Indices.
But price increases have been leading to a slowdown in the volume of home sales.
Earlier this month, the National Association of Realtors reported that home sales are cooling, largely due to affordability concerns on the part of buyers. The pace of existing-home sales fell 3.2% last month from June to a seasonally adjusted annual rate of 5.39 million. Some of the country's most expensive markets, from California to Denver, have seen some of the steepest declines in sales activity.
Nonetheless, the hottest markets in the country, primarily on the West Coast, continued to show double-digit price gains, with Portland reporting a 12.6% year-over-year gain, Seattle showing an 11% gain, and Denver with a 9.2% increase.
Month-over-month prices the U.S. Index rose 1% in June before seasonal adjustment, while the 10- and 20-city indices both increased 0.8% from May to June.
After seasonal adjustment, the national index rose 0.2% month-over-month, and both the 10- and 20-city indexes reported 0.1% month-over-month decreases..
Economists expect demand to continue cooling heading into the second half of 2016, which eventually is likely to lead to a slowdown in price growth. Real-estate brokerage Redfin reported that demand for homes in July was down 14% from the same month last year, the sixth consecutive month of year-over-year declines In buyer demand.
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