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US home prices ease in June
[NEW YORK] The pace of gains in US home prices slowed June but solid demand and tight supplies should keep a floor on the market, analysts said Tuesday.
Prices for the top 20 cities actually edged 0.1 per cent lower in June, according to the S&P CoreLogic Case-Shiller Indices.
The year-on-year rise was 5.1 per cent, down from 5.3 per cent in May. Price gains remained strongest in the northwest cities of Portland and Seattle, and Denver, Colorado was strong as well.
Gains have been weakest in the east coast hubs of Washington and New York.
David Blitzer, managing director at S&P Dow Jones Indices, said overall the US housing sector, a key part of the economy, is "in good shape."
"Sales of new single family homes were at a 654,000 seasonally adjusted annual rate in July, the highest rate since November 2007." However, he added, "While the real estate sector and consumer spending are contributing to economic growth, business capital spending continues to show weakness."
Ian Shepherdson of Pantheon Macroeconomics said that the tight supply of new and used houses on the market and pent-up demand due to the economy's slow recovery from the 2008-2009 recession means prices are not likely to fall.
"The key point here is that tight inventory continues to exert upward pressure on existing home prices, with the underlying trend currently running at about 5 per cent year on year. We expect the rate of increase to pick up speed through the second half of the year."