Despite rising mortgage rates, U.S. home prices continued to inch up in June, rising 0.7% after seasonal adjustment compared with May, according to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index.
Month over month, the index’s 10-city and 20-city composites – measuring home prices in the nation’s 20 largest cities – both posted an increase of 0.9%.
Year over year, U.S. home prices were flat compared with June 2022. The 10-city composite was down 0.5% while the 20-city composite was down 1.2%.
Chicago, Cleveland and New York again led the way reporting the highest year-over-year gains among the 20 cities.
Chicago remained in the top spot with a 4.2% year-over-year price increase, with Cleveland at 4.1% and New York at 3.4%.
But there remains stark regional differences in home price growth: Of the 20 cities, 10 posted year-over-year decreases in home prices while the other 10 posted year-over-year increases.
“U.S. home prices continued to increase in June 2023,” says Craig J. Lazzara, managing director at S&P DJI. “Our National Composite rose by 0.9 percent in June, and it now stands only -0.02 percent below its all-time peak from exactly one year ago.
“As we’ve noted previously, the recovery in home prices is broadly based,” Lazzara says. “Prices rose in all 20 cities in June, both before and after seasonal adjustment. Over the last 12 months, 10 cities show positive returns. Otherwise said, half the cities in our sample now sit at all-time high prices.
“Regional differences continue to be striking,” Lazzara adds. “On a year-over-year basis, June’s three best-performing cities were Chicago (+4.2 percent), Cleveland (+4.1 percent), and New York (+3.4 percent) – the same three that had topped our May leader board. At the other end of the scale, the worst performers continue to be in the Pacific and Mountain time zones, with San Francisco (-9.7 percent) and Seattle (-8.8 percent) at the bottom. The Midwest (+2.8 percent) continues as the nation’s strongest region, followed this month by the Northeast (+1.6 percent). The West (-5.9 percent) remains the weakest region.
“June is the fifth consecutive month in which home prices have increased across the U.S. With 2023 half over, the National Composite has risen 4.7 percent, which is slightly above the median full calendar year increase in more than 35 years of data. We recognize that the market’s gains could be truncated by increases in mortgage rates or by general economic weakness, but the breadth and strength of this month’s report are consistent with an optimistic view of future results.”
Photo: Breno Assis