The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which covers all nine U.S. census divisions, reported a 13% annual gain in August, down from the 15.6% gain in July.
“The forceful deceleration in U.S. housing prices that we noted a month ago continued in our report for August 2022,” says Craig Lazzara, managing director at S&P Dow Jones Indices. “For example, the National Composite Index rose by 13% for the 12 months ended in August, down from its 15.6% year-over-year growth in July. The 2.6% difference between those two monthly rates of change is the largest deceleration in the history of the index. These data show clearly that the growth rate of housing prices peaked in the spring of 2022 and has been declining ever since.”
The 10-City Composite Index recorded an annual increase of 12.1% in August, down from 14.9% the previous month. The 20-City Composite Index posted a 13.1% year-over-year gain, down from 16% just a month earlier. Price gains decelerated in each of the 20 cities analyzed for the August report.
“Prices continued to decelerate nationally, and, while the largest declines were seen on the West Coast, the cooling was seen all across the country. Consumers are feeling the pinch in today’s housing market following the record level of home price growth and the massive run-up in home prices,” say Zonda chief economist Ali Wolf and Nikolas Scoolis, manager, housing economics for Zonda. “The monthly mortgage payment nationally is now up roughly 75% when considering home prices and 7% interest rates. As rates remain a negative pressure on affordability, prices will continue to be compressed until the numbers pencil for buyers.”
Miami (+28.6%), Tampa, Florida (+28.0%), and Charlotte, North Carolina (+21.3%) reported the highest year-over-year gains in prices among the 20 cities analyzed for August. Before seasonal adjustment, the U.S. National Index posted a 1.1% month-over-month decline in August, while the 10-City and 20-City Composites both posted decreases of 1.6%. Lazzara says the “continuing prospects for a challenging macroeconomic environment” suggest home prices will likely decelerate further.
“On a month-over-month basis, the biggest declines occurred on the West Coast, with San Francisco (-4.3%), Seattle (-3.9%), and San Diego (-2.8%) falling the most,” Lazzara says. “Despite the ongoing deceleration, August’s housing prices remain well above year-ago levels in all 20 cities. Price growth continued strongest in the Southeast (+24.5%) and South (+23.6%).
