House Prices Increase Again, But at Slower Pace, Case-Shiller Index Reports

(Illustration courtesy of S&P CoreLogic Case-Shiller Indices)

U.S. home prices reached a record high in July despite a decelerating trend, according to the S&P CoreLogic Case-Shiller Indices.

The S&P CoreLogic Case-Shiller Home Price Index reported a 5.0% annual gain for July, down from a 5.5% annual gain in the previous month.

After seasonal adjustment, the U.S. National Index posted a 0.2% month-over-month increase, the report said.

“With the summer characterized by broader cooling of housing demand amid high mortgage rates, home prices continued to weaken, and July monthly gains appear to be falling below the historical trend,” CoreLogic Chief Economist Selma Hepp said. “Nevertheless, with a speedy decline in mortgage rates since August, housing market demand tracked by pending sales activity in CoreLogic data is finally showing signs of a rebound, which is expected to boost monthly price gains and return them to historical trends.”

Hepp noted that weakness in home prices remains in markets that have struggled with demand this year, including markets in Texas and Florida, while more expensive Western markets started to feel the pressure from rising rates in late spring. “Going forward, home prices are likely to see a boost from a drop in mortgage rates and improved affordability,” she said.