The strong upward momentum in home prices seen across the country showed signs of slowing in June, according to the latest S&P CoreLogic Case-Shiller data.
Home prices in 20 U.S. cities rose at their slowest pace since 2016 amid high prices and higher mortgage rates, according to Bloomberg’s analysis of the data. All cities posted gains on a year-over-year basis, but New York was the only metro area that saw a drop between June and May.
Some cities still posted strong gains. Las Vegas led with a 13 percent annual increase, edging past Seattle for the top spot, but only by 0.2 percent. Las Vegas’ 1.4 percent seasonally adjusted month-to-month increase was the largest as well, followed by Cleveland, Detroit and Minneapolis, according to Bloomberg.
The trend played out in Southern California, which saw its slowest June in four years this year. The 22,706 homes sold in June were 15 percent lower than average sales since 1988.
In May, CoreLogic found that while prices were up by 6.4 percent year-over-year, the pace of sales was slowing. Sales of new homes hit an eight-month low in June, dropping by 5.3 percent from May. Existing home sales fell for the third straight month.
Starter homes were at their highest prices since 2008 in the second quarter, meaning the barrier for entry into the home market is high. Typical first-time buyers need to spend around 23 percent of their income on their first home, up two percent compared to the first quarter of the year.
[Bloomberg] – Dennis Lynch