US home prices slowed sharply to a single-digit
rate in May on a year-over-year basis, the slowest rate since February 2013,
according to a key big-city home-price report.
US city home prices based on 10 major US cities
rose 9.4% in the year ended in May, according to the S&P/Case-Shiller Home Price
Index survey released Tuesday. The 20-city price index increased 9.3% - -
down from a 10.8% yearly rate in April.
In the month of May, the 10- and 20-City
Composites posted gains of 1.1%. For the second consecutive month, all twenty
cities posted increases. Charlotte posted its highest monthly increase of 1.4%
in over a year. Tampa gained 1.8%, followed by San Francisco at +1.6% and
Chicago at +1.5%.
Phoenix and San Diego were the only cities to
gain less than one percent with increases of 0.4% and 0.5%, respectively.
“Home prices rose at their slowest pace since
February of last year,” said David M. Blitzer, chairman
of the Index Committee at S&P Dow Jones Indices. “The 10- and 20-City
Composites posted just over 9%, well below expectations. Month-to-month, all
cities are posting gains before seasonal adjustment; after seasonal adjustment
14 of 20 were lower.
“Year-over-year, nine cities – Las Vegas (16.9%),
San Francisco (15.4%), Miami (13.2%), San Diego (12.4%), Los Angeles (12.3%),
Detroit (11.9%), Atlanta (11.2%), Tampa (10.2%) and Portland (10.0%) – posted
double-digit increases in May 2014. The Sun Belt continues to lead with seven of
the top eight performing cities. Eighteen of 20 cities had lower year-over-year
numbers than last month; San Francisco and San Diego saw their year-over-year
figures decelerate by about three percentage points.
“Housing has been turning in mixed economic
numbers in the last few months. Prices and sales of existing homes have shown
improvement while construction and sales of new homes continue to lag. At the
same time, the broader economy and especially employment are showing larger
improvements and substantial gains.”