U.S. home prices rose 2.2% in June, compared to May, and increased 7.1% in the second quarter, compared to the first quarter, according to the S&P/Case-Shiller Home Price Indices.
Home prices have increased 10.1% since the second quarter of 2012; however the pace of the increase appears to be slowing.
The report's 10-City and 20-City composites posted returns of 11.9% and 12.1%, respectively, from the second quarter of last year.
All 20 metro areas posted gains on a monthly and annual basis. Dallas and Denver reached new all-time highs, with increases of 1.7% each in June. San Francisco's rebound was the largest, up 47% from its low in March 2009. Phoenix was second, 37.1% above its September 2011 low.
David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, notes that the pace of home price increases has moderated slightly.
‘Overall, the report shows that housing prices are rising but the pace may be slowing,’ Blitzer says in the report. ‘Thirteen out of 20 cities saw their returns weaken from May to June. As we are in the middle of a seasonal buying period, we should expect to see the most gains. With interest rates rising to almost 4.6%, home buyers may be discouraged, and sharp increases may be dampened.’
Metro areas where home prices fell the most as a result of the financial crisis have made the biggest gains.
Blitzer notes that the Southwest and California have led the recovery so far, ‘with Las Vegas, Los Angeles, Phoenix and San Francisco posting at least 15 months of gains.’
‘Starts and sales of new homes continue to lag the stronger pace set by existing homes,’ Blitzer says. ‘Despite recent increases in mortgage interest rates, affordability is still good as credit qualifications have eased somewhat.’
For more, check out the full report.