S&P CoreLogic Case Shiller: May Home Prices Disappoint, Down Year-Over-Year

The leading home price metric in housing, the Case-Shiller, found that Dallas home prices (Houston prices are not tracked) rose 9.0 percent year-over-year in May, which was 4 whole percentage points above the national average; monthly growth from April to May, meanwhile, was a relatively modest 1.3 percent, but still above the national averages. The 10-city index gained 4.4% from a year earlier down from 4.7% last month, and the 20-city index gained 5.2% year-over-year, below a 5.4% increase in April.

“Home prices continue to appreciate across the country”, S&P’s David M. Blitzer said in the report. Although May’s results are still in the positive, slowed growth in home prices in expected in the future, echoed by results of the SCE Housing Expectation Survey from Federal Reserve Bank of NY.

However, Robert Shiller, professor of economics at Yale University and co-creator of the Case-Shiller Index, was more bearish in an interview Tuesday with Bloomberg Business. “And of all the states that were hit hard during the crash, Florida still has the most room to grow to get back to peak housing prices”.

Portland, Oregon, led the gainers with price appreciation of 12.5 percent in May. The Federal Housing Finance Agency House Price Index for May rose only 0.2% – which is the weakest monthly performance in almost a year and one of the weakest of the whole recovery.

“Sellers are in the driver’s seat, as buyers contend with fierce competition and very fast-moving markets”, Svenja Gudell, chief economist at real estate data provider Zillow, said.

Month over month, USA housing prices grew 1.2 percent over April, the report found. However, a shortage of inventory is keeping prices high and making entry-level homes less affordable.

Homebuyer demand fell 17% in June compared to the same time last year, the fifth consecutive month of year-over-year declines, according to Redfin, a real-estate brokerage, as fewer customers requested home tours and wrote offers. Not seasonally adjusted, all three portions of the index edged up marginally from April levels.

The hottest markets nationally continued to be in the Pacific Northwest.