US home-price gains in cities slow for 15th month in a row

Washington

HOME-PRICE gains in 20 US cities decelerated for a 15th straight month and were weaker than projected, pointing to continued cooling in the housing market.

The S&P CoreLogic Case-Shiller index of property values increased 2.1 per cent from a year earlier, according to data released this week, versus a 2.4 per cent gain in the prior month. Prices were little changed from a month earlier.

The data underscored the overall housing market slowdown in the past year and hurdles that potential buyers confront, such as mounting personal debt and home price increases that have outstripped income gains until recently. At the same time, the solid labour market is supporting sales.

The weakest results were concentrated in West Coast markets Seattle, San Francisco, and San Diego, while southwestern markets Phoenix and Las Vegas maintained their lead.

Another report from the Federal Housing Finance Agency (FHFA) showed that prices rose 4.8 per cent in June from the same period a year earlier, and 0.2 per cent on a month-over-month basis.

The advance from May matched the median forecast. The FHFA gauge is based on conforming, conventional mortgages purchased or securitised by Fannie Mae or Freddie Mac.

Another recent report showed existing home sales rose to a five-month high in July on lower borrowing costs and smaller home-price gains. Other data show housing starts for single-family homes climbed to the highest level since January as building permits rebounded.

Lower mortgage rates are likely to support demand as well as home-price gains, according to FHFA's senior advisor for Economics Lynn Fisher.

A separate report from the Conference Board showed that 6 per cent of respondents in August said they plan to buy a home within six months, down from a reading of 7.4 per cent that was the highest since 2017. BLOOMBERG