U.S. home prices increased yet again in July, rising 0.5%, after seasonal adjustment, compared with June and increasing 5.9% compared with July 2016, according to the S&P CoreLogic Case-Shiller home price index.
The 10-city composite increased 0.4%, month-over-month, while the 20-city composite posted an increase of 0.3%.
Before seasonal adjustment, home prices nationwide increased 0.7% in July compared with June.
The 10-city and 20-city composites reported increases of 0.8% and 0.7%, respectively.
All 20 cities reported increases in July before seasonal adjustment; after seasonal adjustment, 17 cities saw prices rise.
In a statement, David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, says although the Pacific northwest has seen home prices increase the fastest in recent months, other areas are closing the gap.
“The leadership [in home price gains] continues to shift among regions and cities across the country,” Blitzer says in a statement. “Dallas and Denver are also experiencing rapid price growth. Las Vegas, one of the hardest hit cities in the housing collapse, saw the third fastest increase in the year through July 2017.”
Blitzer says as home prices continue to rise, “other housing indicators may be leveling off.”
”Sales of both new and existing homes have slipped since last March,” he says. “The Builders Sentiment Index published by the National Association of Home Builders also leveled off after March.”
In addition, there is the still-largely-unknown impact from hurricanes Harvey and Irma.
“The housing market will face two contradicting challenges during the rest of 2017 and into 2018,” Blitzer says. “First, rebuilding following hurricanes across Texas, Florida and other parts of the south will lead to further supply pressures. Second, the Fed’s recent move to shrink its balance sheet could push mortgage rates upward.”