Home prices continue to rise, with no end in sight

Inman News

US home prices climbed 0.6 percent between June and July and reported an annual increase of 1 percent, erasing earlier declines

Home prices continued their ongoing upward climb during July, data released Tuesday shows.

The S&P CoreLogic Case-Shiller Index climbed 0.6 percent between June and July, and reported an annual increase of 1 percent.

“U.S. home prices continued to rally in July 2023,” S&P DJI Managing Director Craig Lazzara said in a statement. “The increase in prices that began in January has now erased the earlier decline, so that July represents a new all-time high for the National Composite.”

Ten of the 20 cities in the S&P’s 20-city composite have reached all-time highs in pricing, while all 20 cities saw price increases during July, according to the data. The 10- and 20-city composites were up 0.9 and 0.1 percent respectively.

Also released on Tuesday, the Federal Housing Finance Agency House Price Index measured a 0.8 percent increase in housing prices between June and July, and a 4.6 percent increase between July 2022 and 2023.

Experts attributed the continued upward pressure on housing prices to high levels of buyer demand and historically low levels of supply as would-be sellers put off listing their homes due to high mortgage rates.

“Today’s S&P CoreLogic Case-Shiller Index showed that buyer demand continues to outmatch housing supply, creating upward pressure on home prices despite the fact that home purchase costs are taking up an outsized share of household incomes,” Realtor.com Chief Economist Danielle Hale said in a statement.

Regional differences continued to be striking, with the Northeast and Midwest outperforming once-red-hot Sun Belt cities. Chicago saw the highest annual increase at 4.4 percent, while Cleveland and New York City followed at 4 percent and 3.8 percent respectively.

The Case Shiller index for Chicago (Case Shiller)

At the bottom for July was Las Vegas, where prices fell by 7.2 percent year over year, and Phoenix, where they dropped 6.6 percent after soaring to new highs during the pandemic market.

“All of the cities at all-time highs are in the Eastern or Central time zones, and with two exceptions (Dallas and Tampa), all of the cities not at all-time highs are in the Pacific or Mountain time zones,” Lazzara said.