Home prices rose 4.3% annually in June, unchanged from the gain seen in May, according to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index.
Gains had slowed slightly in May, so this appears to be a small recovery from the coronavirus-induced setback in home sales in March and April.
The 10-City Composite increased 2.8% annually, down from 3% in the previous month. The 20-City Composite rose 3.5% year-over-year, down from 3.6% in the previous month.
Phoenix, Seattle and Tampa continued to post the strongest annual gains among the 19 cities (Detroit was excluded due to continued reporting issues). Phoenix home prices jumped 9% annually, followed by Seattle with a 6.5% increase and Tampa with a 5.9% increase. Five of the 19 cities reported higher price increases in the year ending June 2020 versus the year ending May 2020.
“More data will be required to understand whether the market resumes its previous path of accelerating prices, continues to decelerate, or remains stable,” said Craig Lazarra, managing director at S&P Dow Jones Indices. “That said, it’s important to bear in mind that deceleration is quite different from an environment in which prices actually fall.”
Home prices are being fueled by fierce competition among buyers for a very slim supply of homes for sale. Inventory at the end of July was down 21% annually, according to the National Association of Realtors. Unsold inventory is now at a 3.1-month supply at the current sales pace, down from 3.9 months in June and down from a 4.2-month supply in July 2019.
Meanwhile home sales, which plummeted in March and April due to the coronavirus pandemic, have now recovered and then some. Sales of existing homes jumped more than 20% month-to-month in June and continued to soar even higher in July, when they were nearly 9% higher annually.