S&P CoreLogic HPI Hits Record Highs in July 2024, But Price Gains Are Slowing

New York led with an 8.8% annual gain, followed by Las Vegas at 8.2% and Los Angeles at 7.2%. Portland had the smallest increase at 0.8%, unchanged from June.

Month-Over-Month Growth Flat

Month-over-month, the U.S. National Index increased by only 0.1% before seasonal adjustment. Both the 10-City and 20-City Composites were flat. After seasonal adjustments, the national index rose 0.2%, while both composites saw a modest 0.3% increase. Eight of the 20 tracked cities recorded monthly price declines.

Low-Priced Homes Lead Gains

Homes in the lower price tiers continue to outperform. Tampa’s low-tier properties gained 88% over five years, while New York’s low-price segment drove an annual increase of 10.8%. However, high-price tiers in cities like San Francisco and Los Angeles are also performing well, benefiting wealthier homeowners but complicating entry for first-time buyers.

Regional and National Trends

The Northeast remains the best-performing region, with New York topping the market for the third straight month. The Midwest also saw all-time highs, while the South experienced slower growth, though it includes several top-performing markets since 2020.

The FHFA reported a 0.1% rise in U.S. home prices in July, up 4.5% from a year earlier. Growth was strongest in the East North Central and New England regions.

Market Forecast: Cooling Ahead

While home prices continue to rise, the pace is slowing. With declining mortgage rates, affordability may improve, but overall growth is likely to remain modest. The short-term outlook is cautiously bullish, especially for lower-priced homes.