Home prices saw the biggest slowdown in the history of the Case-Shiller Index in July, according to the most recent data.
- Y-O-Y: The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index reported a 15.8% annual gain in July, down from 18.1% in the previous month.
- M-O-M: The National Index posted a month-over-month decrease of -0.2% in July, down from June’s 0.3% increase.
Faster Than Expected. Economists projected that the 20-City Composite index would fall from 18.7% to 17.0% but it actually dipped to 16.1% for the month.
Still Over 30. Despite the faster slowdown, the top two cities were still over 30% in July. Tampa took the top spot with 31.8% year-over-year growth with Miami a close second at 31.7% and Dallas in third (+24.7%)
- FYI: In June, Tampa still had the top spot with 35.0% growth and is off the high of 36.1% reported in May.
ANALYSIS: Craig J. Lazzara, Managing Director at S&P DJI, said this month’s slowdown was the largest in the index’s history. “Although U.S. housing prices remain substantially above their year-ago levels, July’s report reflects a forceful deceleration…The -2.3% difference between those two monthly rates of gain is the largest deceleration in the history of the index.”
BOTTOM LINE: As mortgage rates continue to skyrocket home prices have to fall to maintain some semblance of affordability. Considering rates are up over a point since July homes prices are expected to only fall faster.
NOTE: The FHFA House Price Index also fell faster than expected. Economists had projected year-over-year gains would fall to 15.0% but they actually fell to 13.9% in July thanks to a 0.6% month-over-month decline.