Home price gains
edged lower in April, a sign that rising mortgage rates may be putting slight
downward pressure on what consumers are able and willing to pay for homes.
The S&P CoreLogic Case-Shiller National Home Price
Index, which measures average home prices in major metropolitan areas across
the nation, rose 6.4% in April, down from a 6.5% year-over-year increase
reported in March.
The 10-city index gained 6.2% over the year, down slightly
from 6.4% the prior month. The 20-city index gained 6.5%, down from 6.7% the
previous month. Economists surveyed by The Wall Street Journal had expected
stronger home price growth in April, with the 20-city index gaining 6.8%.
While the price gains lost a bit of momentum last month,
prices continue to grow faster than both incomes and inflation. Half of the
housing markets in the country are now above their 2006 peaks. (Accounting for
inflation just three markets are above that peak.)
The biggest price gains remained concentrated in the West.
Seattle saw a 13.1% annual gain in prices in April compared to a year earlier,
while Las Vegas prices increased 12.7% and San Francisco saw an 10.9% increase.
“The favorable economy and moderate mortgage rates both
support recent gains in housing. One factor pushing prices up is the continued
low supply of homes for sale,” said David Blitzer, managing director at S&P
Dow Jones Indices.
Rising mortgage rates have contributed to a slowdown in the
pace of home sales in recent months and may also be putting slight downward
pressure on prices. The rate for a 30-year mortgage was 4.57% last week, up
from 3.99% at the end of last year, according to mortgage company Freddie Mac .
Month-over-month, the U.S. home-price index rose 1% in
April before seasonal adjustment, while the 10-city and the 20-city index rose
0.6% and 0.8% respectively from March to April.
After seasonal adjustment, the national index rose 0.3%
month-over-month. The 10-city index rose 0.1% and the 20-city index rose 0.2%.
Seventeen out of twenty cities saw seasonally adjusted price gains in April.
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