Despite A Decline In Home Prices In June, They Remained Much Higher Than They Were A Year Ago
S&P CoreLogic Case-Shiller Indices report that in June, home prices were 18% higher than they were during the same month a year ago, according to the S&P CoreLogic Case-Shiller Indices.
As a result, this is a slower pace than what was recorded in May of this year, when the annual growth rate was 19.9%. In the 10-city composite, the growth rate is 17.4%, down from 19.1% in May.
As compared to May, the 20-city composite was 18.6% higher year over year, compared to 20.5% in May.
Among the 20 cities, Tampa, Florida, Miami, and Dallas saw the highest year-over-year growth rates in June, with increases of 35%, 33%, and 28.2%, respectively.
There was only one city out of the 20 that reported a higher price increase in the year ended in June 2022 as compared to the year ended in May 2022.
Despite A Decline In Home Prices In June, They Remained Much Higher Than They Were A Year Ago
According to Craig Lazzara, managing director at S&P Dow Jones Indices, “it’s important to bear in mind that deceleration and decline are two completely different things, and that prices are still rising at a robust clip,” according to a release.
“June’s growth rates for all three composites are at or above the 95th percentile of historical growth rates, which is consistent with the trend over the years.
As a matter of fact, in the first half of 2022, the National Composite has increased by 10.6%.”
In the past 35 years, only four complete years have seen increases that large, according to him.
Last week, another report showed that home prices fell by 0.77% from June to July, according to the report.
In recent months, mortgage rates have fallen for the first time in nearly three years, according to Black Knight, a provider of mortgage software, data, and analytics.
Although the drop in prices may seem small, it is the largest single-month decline in prices since January 2011. As a result, it is the second-worst July performance since 1991, and it is the second-worst July performance since the Great Recession in 2010 when the market fell by 0.9%.
Because of the rise in mortgage rates, home prices are softening, which in turn makes an already expensive housing market even more expensive.
In the last several months, both new and existing home sales have been declining, leading some economists to pronounce that we are in the middle of a housing recession.
As we reported previously, mortgage financing has become more expensive as the Federal Reserve has ratcheted up interest rates over the past several months, a trend that continued as we gathered our June mortgage data.
Considering that the macroeconomic environment continues to be challenging, it is likely that home prices will continue to decline,” stated Lazzara, citing macroeconomic factors.