August data released this morning by S&P Dow Jones Indices reveals that, while home prices throughout the U.S. continue to increase, the rapid pace in those gains seen earlier continues to decelerate. The S&P/Case-Shiller National Index as well as both composite indices eked out 0.2 percent increases from July to August but all three slipped to lower year-over-year gains than they posted the previous month.
The 10-City Composite Index was up 5.5 percent compared to August 2013 and the 20-City gained 5.6 percent. Both composites had posted 6.7 percent increases from July 2013 to the same period in 2014. The National Index, which covers all nine U.S. Census divisions, had a 5.1 percent annual growth in August against 5.6 percent in July.
David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices said, “The Sun Belt region reported its worst annual returns since 2012, led by weakness in all three California cities — Los Angeles, San Francisco and San Diego.” He noted however that even as the year-over-year numbers weaken, home prices continue to increase overall and the National Index increased for the eighth consecutive month.
Those monthly increases were smaller in August than in July as well. The 2 percent increase in all three indices from July to August was one third the increase posted by each during the previous month.
Blitzer said that the large extent of slower increases is seen in the annual figures. All 20 cities also had lower annual numbers than the previous month. “Las Vegas continues to see a sharp deceleration in their annual home prices with a 10.1% annual return, down just below three percent from last month,” Blitzer said. “Miami is now leading the cities with a 10.5% year-over-year return. San Francisco, which has shown double-digit annual gains since November 2012, posted an annual return of 9.0% in August.
“Despite softer price data, other housing data perked up. September figures for housing starts, permits and sales of existing homes were all up. New home sales and builders’ confidence were weaker. Continued labor market gains, low interest rates and slower increases in home prices should support further improvements in housing,” he said.
Senior Director, Coldwell Banker New Homes Division
With over 200 condominium, townhome and loft projects successfully marketed
“Fewer properties for sale with such remarkably low interest rates make it a great time to sell but a more difficult time to buy”