U.S. home prices are still rising, but at the slowest pace since October of 2012, according to the S&P CoreLogic Case-Shiller national home price index (not seasonally adjusted) for February released Tuesday. The year-over-year increase of 4.0% was more than two full percentage points below the 6.5% increase posted in February of 2018. Month over month, the index dropped from 4.2% in January. February was the 11th straight month that home prices have grown more slowly than they did a year ago.
Some cities continue to see sharp increases, but these too are slowing down. Las Vegas home prices are 9.7% higher than they were a year ago, while Phoenix showed an increase of 6.7% and Tampa posted an increase of 5.4%. The U.S. city with the smallest annual price gain was San Diego, where prices increased just 1.1%.
On a seasonally adjusted basis, the consensus economists’ estimate called for the national average home price to rise by 3.2% year over year. The actual 12-month increase came in at 3.0%.
In all U.S. cities included in the 20-city home price index, February house prices rose 3.0% year over year, with 16 of 20 posting non-seasonally adjusted (NSA) month-over-month price decreases. On an NSA basis, prices rose 0.2% month over month on the 20-city index.
David M. Blitzer, S&P index committee chair, said:
Regional patterns are shifting. The three California cities of Los Angeles, San Francisco and San Diego have the three slowest price increases over the last year. … Prices generally rose faster in inland cities than on either the coasts or the Great Lakes. Aside from Las Vegas, Phoenix, and Tampa, which saw the fastest gains, Atlanta, Denver, and Minneapolis all saw prices rise more than 4% — twice the rate of inflation.
Mortgage loan rates had ticked up to 4.28% Tuesday morning, according to Mortgage News Daily, after rising slightly in the prior week to a top-tier rate of 4.25%. The FOMC meeting begins Tuesday and the announcement of the decision on raising the federal funds rate comes Wednesday afternoon.