S&P/Case-Shiller: Home Prices Rose 1.1% In May


Home price appreciation continued to slow across the U.S. in May, rising just 1.1% compared to April – the smallest gain since February of last year, according to the S&P/Case-Shiller Home Price Indices.

Home prices were up about 9.3%, on average, compared to May 2013 – but the year-over-year gains are eroding: As of April, home prices were up about 10.8% on a year-over-year basis. All cities in the index's 20-city composite, with the exception of Charlotte, N.C., and Tampa, Fla., saw their annual rates decelerate.

Charlotte posted its highest monthly increase of 1.4% in over a year. Tampa gained 1.8%, followed by San Francisco at +1.6% and Chicago at +1.5%. Phoenix and San Diego were the only cities to gain less than 1% with increases of 0.4% and 0.5%, respectively.

‘Year over year, nine cities – Las Vegas, San Francisco, Miami, San Diego, Los Angeles, Detroit, Atlanta, Tampa and Portland – posted double-digit increases in May 2014,’ says David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices. ‘The Sun Belt continues to lead with seven of the top eight performing cities. Eighteen of 20 cities had lower year-over-year numbers than last month; San Francisco and San Diego saw their year-over-year figures decelerate by about three percentage points.

‘Housing has been turning in mixed economic numbers in the last few months,’ Blitzer adds. ‘Prices and sales of existing homes have shown improvement while construction and sales of new homes continue to lag. At the same time, the broader economy and especially employment are showing larger improvements and substantial gains.’

Average home prices across the U.S. were, as of May, back to their summer 2004 levels – however, they were 17% to 18% below their peak in June/July 2006.

Charlotte was the only city to see its annual rate improve; it posted a 4.7% year-over-year gain in May versus 4.5% in April. Tampa held steady with a gain of 10.2%.

Despite seeing its rates decrease by two to three percentage points, Las Vegas remained the top-performing city with a return of +16.9%, followed by San Francisco at +15.4%.

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