According to the recently released Standard & Poor’s/Case-Shiller 20-city home price index U.S. home prices increased 9.3 percent in May from 12 months earlier, the slowest pace in the last 15 months. That’s down from 10.8 percent in April and the smallest annual gain since February 2013.
Yearly price gains slowed in 18 of the 20 cities measured.
During 2104home sales have been slowed by a combination of weak wage increases and tight credit, particularly for first-time buyers. Mortgage rates also increased last summer, which, of course, slowed sales.
While sales of existing homes have picked up, new home sales dropped significantly in June. In fact, new home construction has decreased for two straight months which could lead to fewer construction jobs.
It’s important to remember that home prices have risen steadily since housing sales began to recover in 2012. The Case-Shiller index has risen 27.3 percent after an all-time low in March 2012. however, home prices remain about 17 percent below the high reached in the summer of 2006, just before the housing bubble burst.