Home price appreciation continues to unwind as S&P Case-Shiller 20-city adjusted data show a 0.2 percent decline in June following a 0.3 percent in May. Year-on-year, the adjusted rate is plus 8.1 percent vs 9.3 percent in May. Monthly declines sweep 13 of the 20 cities with Minneapolis, Detroit, Atlanta and Chicago showing special weakness. Unadjusted data, which are followed in this report, show a monthly gain of 1.0 percent that reflects the relative strength of summer months for sales. But the year-on-year rate, where this effect is offset, tells exactly the same story as the adjusted data, at 8.1 percent vs 9.3 percent in the prior month.Home prices are weakening, based not only on this report but also on FHFA data, also released this morning, and on yesterday’s new home sales report as well as last week’s existing home sales report. Easing home prices are a plus for sales but a negative of course for homeowner wealth.

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Market Consensus before announcement
The S&P/Case-Shiller 20-city home price index (SA) unexpectedly declined in May at a seasonally adjusted minus 0.3 percent and followed a 0.1 percent rise the month before. May’s dip was the first negative reading since January 2012. Year-on-year, both adjusted and unadjusted, home prices were at plus 9.3 percent, down substantially from 10.8 percent and 12.4 percent in the two prior months. Unadjusted data showed deceptive strength, at a monthly plus 1.1 percent. But this reflected seasonal strength in the spring months for housing and was not a sign of pricing power.

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