U.S. Home Prices Increase for Fourth Consecutive Month

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U.S. home prices rose for a fourth consecutive month in May due to a limited supply of for-sale listings. However, on an annual basis, home prices posted a second consecutive decline, as higher mortgage rates made home purchases more expensive for buyers. Home prices were up 1.2% from April to May, according to the S&P CoreLogic Case-Shiller U.S. National Home Price Index, which measures average home prices across the nation. While that was the fourth month in a row that prices have increased, the annual rate of change has weakened over the past 14 months since reaching a historic peak of 20.8% in March 2022. Home prices were down 0.5% year-over-year in May 2023, which was a slight decline from the 0.1% annual dip in April 2023 and the second consecutive annual decline since April 2012. Looking at more granular results, the S&P CoreLogic Case-Shiller 20-City Composite Index, which tracks prices in the 20 largest metros, posted a 1.5% month-over-month gain, while the annual change remained steady bettween April and May with a 1.7% year-over-year downturn. In May, all 20 cities in the index reported month-over-month price increases. The largest monthly increase was in Cleveland (2.7%), followed by Chicago and Detroit (both at 2.3%). On an annual basis, 10 of the 20 metro areas recorded lower prices, with the deepest pull backs in West region markets, led by Seattle (-11.3%) and San Francisco (-11%). The nation’s biggest annual price hikes were in Chicago (4.6%), Cleveland (3.9%) and New York (3.5%).