U.S. Home Prices Declined in August for First Time in a Year

(Bloomberg) --

Home prices in 20 U.S. cities declined in August from the prior month for the first time in a year, reflecting moderation in some once-hot real estate markets.

The S&P CoreLogic Case-Shiller index of property values fell 0.2% during the month, compared with estimates for a 0.1% decline, after no change in July, according to data Tuesday. Prices increased 2% from August 2018, matching the year-over-year gain in the prior month but slightly below the median estimate of economists in a Bloomberg survey. Nationally, annual home prices were up 3.2% after a 3.1% increase in July.

Key Insights

• Although mortgage rates are hovering near a three-year low, tepid wage gains are limiting buyer enthusiasm in markets such as Las Vegas and New York. Meanwhile a shortage of affordable inventory is keeping prices elevated.
• Price gains may firm in the coming months amid recent signs of strength across the sector. The median sales price for previously-owned homes saw the biggest annual gain since January 2018 last month as new home sales steadied, according to separate reports recently.
• Phoenix, Miami, Seattle and Tampa led price gains in August from a month earlier.

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• All 20 cities in the index, with the exception of San Francisco, showed year-over-year gains. Prices there fell 0.1% from August 2018.
• Prices in 17 cities rose from the prior month on a seasonally adjusted basis. In New York, home prices fell 0.4% from July, while in Las Vegas, they dropped 0.1%. In Detroit, prices were unchanged month over month.

--With assistance from Chris Middleton.

To contact the reporter on this story: Reade Pickert in Washington at epickert@bloomberg.net

To contact the editors responsible for this story: Scott Lanman at slanman@bloomberg.net, Vince Golle

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