A “For Sale” sign outside a home in Albany, California on Tuesday, May 31, 2022.
David Paul Morris | Bloomberg | Getty Images
According to the S&P CoreLogic Case-Shiller indices, home prices in June were 18% higher than in the same month last year.
That’s a slower pace than May this year, which showed an annual gain of 19.9%. The 10-city association rose by 17.4% compared to 19.1% in the previous month. The 20-city cluster was up 18.6% year-on-year, compared to 20.5% in May.
Of the 20 cities, Tampa, Florida, Miami, and Dallas posted the fastest year-over-year pace in June, with increases of 35%, 33%, and 28.2%, respectively. Only one of the 20 cities reported higher price increases for the year ending June 2022 than for the year ending May 2022.
“It’s important to remember that deceleration and decline are two very different things and that prices are still rising at a robust pace,” wrote Craig Lazzara, managing director at S&P Dow Jones Indices, in a press release. “June growth rates for all three composites are at or above the 95th percentile of historical experience. In the first six months of 2022, the National Composite is actually up 10.6%.”
In the past 35 years, only four full years have seen such a large increase, he said.
Another report last week showed that house prices fell 0.77% from June to July. It was the first monthly decline in almost three years, according to Black Knight, a mortgage software, data and analytics company.
While the drop may seem small, it’s the biggest one-month price drop since January 2011. It’s also the second-worst July performance since 1991, after the 0.9% drop in July 2010 during the Great Recession.
Real estate prices are falling due to rising mortgage rates, making an already expensive real estate market even more expensive. Sales of both new and existing homes have been falling for several months, prompting some economists to speak of a housing recession.
“We have previously noted that mortgage financing has become more expensive as the Federal Reserve raises interest rates, a process that was continuing when our June data was collected. ‘ said Lazara.