The housing market just keeps getting more expensive
Compared to the prior month, the indexed moved 0.6% higher on a seasonally adjusted basis.
"The increase in prices that began in January has now erased the earlier decline."
The cost of homes in the US keeps going up. Recent data from the S&P CoreLogic Case-Shiller Indices indicates a 1% increase in US home prices in July compared to the previous year. This index covers all nine US census divisions and considers repeat-sales data, revealing a 0.6% increase in July after adjusting for seasonal variations.
According to Craig J. Lazzara, managing director at S&P DJI, home prices continued to rise in July 2023. He explained that after a peak in June 2022 and a decline through January 2023, prices have not only recovered since January but also hit a new all-time high in July.
Lazzara pointed out that mortgage rates above 7% have affected how much homebuyers can afford. Surprisingly, home prices haven't dropped as they usually do when interest rates rise. Additionally, a persistent shortage of available homes has kept the market tight and prices high.
Among the cities analyzed, Chicago saw the most significant annual price growth at 4.4%, followed by Cleveland at 4.0%. However, Las Vegas experienced a notable 7.2% decline in home prices compared to the previous year. Lazzara noted that the recovery in home prices is widespread, with 10 out of 20 cities reaching all-time high levels in July.
Year-to-date, the National Composite has increased by 5.3%, surpassing the median increase seen in more than three decades of data. Meanwhile, new home sales data from the Census Bureau revealed a seasonally adjusted annual rate of 675,000 in August, 8.7% below the revised July reading but still 5.8% above the August 2022 estimate.
The National Association of Realtors reported that the median existing-home sale price rose by 3.9% last month compared to August 2022, reaching $407,100.