Home price hikes are slowing more than expected

Increasing supply and slowing demand in the housing market finally causes prices to cool and weakness is accelerating.

Housing prices increased by 2.7% in April, compared to the previous year S&P Corelogic Case-Shiller Index Published on Tuesday. This fell from an annual increase of 3.4% in March and is the smallest gain in about two years.

Since it was a three -month price average that ended in April, the report returned a little bit. Other current readings of the market like someone Parcl LabsIt shows that prices are flat nationally compared to a year ago.

S&P Case-Shiller found that the slowdown in prices kept index measures in 10- and 20-city composites. Both are significantly below their last peaks. In addition, the annual increase in April reading has occurred in the last six months, ie prices have increased the spring market rather than emerging throughout the year.

“What is particularly striking is how this cycle reshapes regional leadership – Pandemic Valentine’s markets are now delayed, while the historically stable artists in the Middle West and Northeast determine the speed of stable artists. This rotation points to a more mature market rather than a speculative herd.” He said.

New York saw the biggest increase in prices with 7.9% annually, and followed by Chicago 6% and Detroit 5.5%. This is a change from the early years of the pandem, in which the sun generation sees great demand and great price gains.

Previously in hot markets are now falling. Both Tampa, Florida and Dallas fell 2.2% and 0.2%, respectively. San Francisco prices were essentially flat and both Phoenix and Miami earned a little more than 1%.

Higher mortgage rates, which have been drawn more than 7% in April and settled just below this sign, keep potential monthly payments near generations and pricing important receiving pools, especially the first timers. According to the National Real Estate Association, this share fell to only 30% of May sales. For the first time, buyers historically constituted 40% of the market.

The supply of houses for sale increases sharply, but Still under pandemic levels. According to a new report of Redfin, only 6% of the sellers are at the risk of sales with loss. This is slightly higher than a year, but still historically low.

While prices are definitely weakened, they are not close to the risk of the latest decreases seen after the subprime mortgage crisis and the Great Stagnation ten years ago.

“Housing supply is seriously restricted, 4% of the existing homeowners Pandemiye period rates and the new construction of the new construction is reluctant to meet the demand. This supply-demand imbalance, some of the sharp corrections that fear continues to provide a price base.” He said.