The Case-Shiller S&P CoreLogic Indexes posted annual declines in home prices for the second straight month in May, while the Federal Housing Finance Agency’s (FHFA) Housing Price Index continues to show an annual rise. The Case-Shiller National Home Price Index, which covers all nine US census divisions, fell 0.5 percent, compared to a loss of 0.1 percent in April. The 1.0 decline in 10-City Composite was a slight improvement from -1.1% in the prior month. The 20 City Composite Index was unchanged from April’s loss of 1.7 percent year-on-year. However, prices were on the rise on a monthly basis, before the seasonally adjusted, the national index recorded an increase of 1.2 percent on a monthly basis and increased by 0.7 percent after the seasonally adjusted. in May. 10-City and 20-City Composite both rose 1.5% on an unadjusted basis while 10-City Composite rose 1.1% and 20-City Composite 1.0% after adjustment. Chicago, Cleveland and New York had the highest annual gains among the 20 cities in May. Chicago moved up to number one with a price increase of 4.6 percent year-over-year, while Cleveland was in second with a 3.9 percent increase. New York debuted in the top three, up 3.5 percent. There was an equal split between the 10 cities reporting lower prices and those reporting higher prices in the year ending May 2023 compared to the year ending April 2023. Craig J. Lazzara, managing director at S&P Dow Jones, called the list of top performers the “Revenge of the Rust Belt.” “If this sounds like an unusual occurrence to you,” he said, “it seems that way to me, too.” “It has been five years since this month that a cold-weather city took the top spot (and that was Seattle, which wasn’t too cold). Since May 2018, the highest-rated cities have been Las Vegas (12 months), Phoenix (33 months), Tampa (5 months), and Miami (9 months).” “At the other end of the scale, the worst performers continue to cluster near the Pacific coast, with Seattle (-11.3 percent) and San Francisco (-11.0 percent) bottom. The Midwest (+2.7%) this month has beaten the Southeast (+2.1%) as the strongest region in the country. The West (-6.9 percent) remains the weakest.” 023. Certainly, the price gains of the past four months could be capped by increases in mortgage rates or by general economic weakness. But the breadth and strength of May’s report dovetails with an optimistic outlook for the months ahead. The FHA said home prices rose 0.7 percent from April to May, which is identical to the increase from March to April. The annual increase was 2.8 percent, down from 3.1 percent in the previous month. For the nine census divisions, seasonally adjusted monthly price changes from April 2023 to May 2023 ranged from a decrease of 0.5 percent in the New England Division to an increase of 1.7 percent in the Pacific Division. The mountain section saw prices drop 2.7 percent year-on-year while they rose 5.5 percent in the east-north central section. “US home prices rose moderately in May, continuing the trend of the past few months,” said Dr. Natalia Polkovnichenko, a supervisory economist in the Research and Statistics Division of the US Federal Housing Administration. However, home prices in some areas of the country remained below levels seen one year ago. The Case-Shiller indices track identical price pairs for thousands of individual homes, each measured in January 2000 at 100. The current value of the national index is 305.15, 10 and 20 towns at 325.72 and 312.02, respectively. The FHFA’s HPI is based on home sales funded by either Fannie Mae or Freddie Mac. It was measured at 100 in January 1991 and currently stands at 404.1.
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