Annual home-price growth continued to slow in July, with year-over-year price gains shrinking for the fourth consecutive month, according to the S&P CoreLogic Case-Shiller National Home Price Index, released Tuesday.
Nationwide home prices posted a yearly gain of 15.8% in July, bringing the index to a reading of 307.45. In June, the index saw a year-over-year increase of 18.1%.
“The -2.3% difference between those two monthly rates of gain is the largest deceleration in the history of the index,” Craig J. Lazzara, the managing director at S&P DJI, said in a statement.
Month over month, the U.S. National Index saw a 0.3% decrease in home prices.
“Home-price appreciation has continued to slow since its peak in April as the Fed works to get inflation under control,” Steve Reich, the chief operations officer of Finance of America Mortgage, said in a statement. “The gradual slowdown can be attributed to higher interest rates, which has tempered what many homebuyers can afford and, in turn, has softened home sales.”
The Case-Shiller 20-city home price index posted a 16.1% year-over-year increase, down from 18.7% a month prior. The annual increase brought the 20-city index to a reading of 316.28. All 20 of the cities analyzed posted lower price increases in the year ending July 2022 as compared to the year ending June 2022.
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“The theme of strong but decelerating prices was reflected across all 20 cities. July’s year-over-year price change was positive for each one of the 20 cities, with a median gain of 15.0%, but in every case July’s gain was less than June’s. Prices declined in 12 cities on a month-to-month basis,” Lazzara said.
Home-price growth in the 10-city home price index also slowed in July, recording an annual gain of 14.9% to a reading of 327.54. In June, the 10-city index posted a year-over-year increase of 17.4%.
Tampa, Miami and Dallas again have the highest year-over-year gains among the 20-cities, recording 31.8%, 31.7% and 24.7% yearly growth in July, respectively.
“Data show the national inventory of active listings rose by about 30% in July over last year and demand continued to weaken, causing home -price growth to moderate. This means buyers are likely seeing a noticeable uptick in price reductions in some markets,” Reich said.
“Affordability constraints have set in motion a rebalancing of power in the housing market,” Nicole Bachaud, Zillow’s senior economist, said in a statement. “A dip in demand from buyers being priced out of the market as mortgage rates soar is causing homes to stay on the market longer and home price growth to moderate.”