Home price increases slowed for the first time in months in April, says S&P Case-Shiller

Home price increases slowed in April but it's the first sign of a cooling in prices.

The Case-Shiller index shows that prices rose in April compared with a year ago. Home prices increased in March. The last time it slowed was in November of last year.

The increase was up from the previous month. The annual gain for the 20 city index was 21.2%, up from the previous month's gain of 21.1%.

In a change from the last five months, when most of the 20 cities saw month-to-month price increases, only nine saw them in April. Atlanta, Charlotte, Dallas, Miami, andTampa all saw gains in the month.

Craig Lazzara, managing director at S&P DJI, said in a release that there were initial signs of a deceleration in the growth rate of US home prices. All but one of the 20 cities recorded double-digit price increases for the year ended in April. The top quintile of historical experience for every city was ranked by the price increase in April.

The strongest price gains came from Miami and Phoenix. Miami had the largest price increase with a 33.3% increase, followed by Phoenix with a 31.3% increase. Nine of the 20 cities reported higher prices in the year ending April 2022, compared to the previous year.

Minneapolis, Washington, D.C., and Chicago were the cities with the largest gains.

The index is a three-month moving average and the price gains for April are not only for April. The average rate on the 30-year fixed mortgage went from 3% to 5% in April. It had crossed 4% by June.

Mortgage financing has become more expensive as the Federal Reserve ramps up interest rates, a process that had only just begun when April data were gathered. Home price growth may not be supported by a more challenging macroeconomic environment.

There are reports of price drops among some sellers in the housing market. There has been an increase in the supply of homes for sale as more listings come on the market. There was a 21% increase in active inventory last week compared to a year ago.

"For buyers and sellers, the road ahead will require more flexibility in pricing, brushing up on negotiation skills, and acknowledging that market conditions today are different than six months ago," said George Ratiu.