The latest S&P CoreLogic/Case-Shiller Indices, released today, show that home prices across the U.S. continue to rise, though the rate of growth has slowed slightly. The Indices reported a 19.7% annual gain in May for single-family home prices, which is down from April’s 20.6% annual gain.
The South and Southeast recorded the strongest gains with cities in Florida and Texas reporting the highest year-over-year increases among the 20 metros in May. Tampa, which was the fastest growing city for the past two months, once again took the cake with a 36.1% increase while Miami trailed close behind with a 34.0% hike. Dallas, in third, logged a 30.8% increase. Minneapolis, Washington, DC and Chicago reported the weakest year-over-year increases.
Only four of the 20 metros bucked the trend of deceleration and reported higher price increases in the year ending May 2022 versus the year ending April 2022.
Recently raised interest rates may have contributed to the modest deceleration of growth in home prices in recent months, and according to experts, the cooling trend is likely to continue.
The complete data for the 20 markets measured by S&P:
Charlotte, North Carolina
Las Vegas, Nevada
Los Angeles, California
New York, New York
San Diego, California
San Francisco, California
“Housing data for May 2022 continued strong, as price gains decelerated slightly from very high levels,” said Craig J. Lazzara, Managing Director at S&P DJI. “The National Composite Index rose by 19.7% for the 12 months ended May, down from April’s 20.6% year-over-year gainDespite this deceleration, growth rates are still extremely robust, with all three composites at or above the 98th percentile historically.”
Lazzara added: “The market’s strength continues to be broadly based, as all 20 cities recorded double-digit price increases for the 12 months ended in May. May’s gains ranked in the top quintile of historical experience for 19 cities, and in the top decile for 17 of them. However, at the city level we also see evidence of deceleration. Price gains for May exceeded those for April in only four cities. As recently as February of this year, all 20 cities were accelerating.”
“We’ve noted previously that mortgage financing has become more expensive as the Federal Reserve ratchets up interest rates, a process that was ongoing as our May data were gathered,” said Lazzara. “Accordingly, a more-challenging macroeconomic environment may not support extraordinary home price growth for much longer.”
Brendan Rascius is RISMedia’s associate online editor. Email him your real estate news to firstname.lastname@example.org.