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2025-07-29 21:35:30
US Home Price Growth Hits Two-Year Slow: High Interest Rates and Limited Affordability, Has the Market Turned? ⑴ On July 29th, S&P CoreLogic Case-Shiller data showed that home price growth in 20 major US metropolitan areas continued to slow, impacted by high mortgage rates and declining affordability. ⑵ In May, the 20-city home price index fell 0.3% month-over-month, bringing its year-over-year growth over the past 12 months (ending in September) to 2.8%, significantly lower than the 3.4% increase in the previous month. ⑶ This was the smallest increase in the index since August 2023 and below the 3% forecast by economists surveyed by Dow Jones Newswires and The Wall Street Journal. ⑷ Nicholas Godec, Head of Fixed Income and Commodities at S&P Dow Jones Indices, said the May data showed a "slow unwinding of price momentum." ⑸ During the pandemic (2021), annual home price growth approached 20%, but has now slowed significantly to 2.8%. ⑹ The broader national house price index also fell 0.3% month-over-month in May, and rose 2.3% year-over-year over the past year, the smallest increase since July 2023. ⑺ Although house prices are no longer growing at an alarming rate and seasonal momentum is weaker than usual, Godec noted that national house prices have only barely remained stable amidst remaining affordability constraints and limited inventory. ⑻ This reflects the market's readjustment around tighter financial conditions, subdued transaction volumes, and increasingly localized dynamics.
