Home Price Gains Cooling Quickly as Weather Warms -CoreLogic

The expected surge in the number ofrnhomes for sale has not yet materialized and the resulting tight supply is amongrnthe factors leading to higher prices.  Inrna report released this morning, CoreLogic’s president and CEO Anand Nallathambirnsaid that “many homeowners are staying put and waiting for better economicrntimes and higher prices in the future.”</p

The CoreLogic Home Price Index (HPI)rnincluding distressed sales (bank owned real estate (REO) and short sales) rosern7.5 percent on an annual basis in June. rnIt was the 28^th consecutive month of year-over-year gains inrnthe index which also increased by 1.0 percent from May to June.  Despite the prolonged period of pricernincreases, CoreLogic said prices nationwide are still 12.9 percent below thernpeak established in April 2006.</p

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The HPI that excludes distressed salesrnincreased by 6.9 percent on an annual basis and was up .9 percent compared tornMay.  That index remains 9.0 percentrnbelow the peak.</p

Excluding distressed sales all 50 statesrnand the District of Columbia showed annual price increases in June with thernlargest being in Massachusetts at 11.2 percent, New York at 9.8 percent, andrnHawaii and California at 9.2 and 9.1 percent respectively.  Increases in the HPI including distressedrnsales were greatest in Michigan at 11.5 percent followed by California (11.3rnpercent), and Nevada (11.1 percent).  </p

Twenty-eight states and the District arernwithin 10 percent of their respective HPI peaks with Nevada, Florida, Arizona,rnRhode Island, and New Jersey still showing the greatest deficits, ranging from -37.5rnin Nevada to 22.2 in New Jersey. </p

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Nallathambi said another factor behindrnthe continued rise in prices is interest rates which, despite increases fromrnrecord levels, still remain at historic lows. rnAggressive investor buying on the East and West coasts are alsorncontributing to price gains.</p

CoreLogic projects that its HPI whichrnincludes distressed sales will rise 0.7 percent from June to July and by 5.7rnpercent from June 2014 to June 2015.  ThernHPI excluding distressed sales is projected to increase 0.6 percent from Junernto July and by 5.0 percent for the year ending in June 2015.</p

Mark Fleming, CoreLogic’s chiefrneconomist said “The pace of home price appreciation is cooling off quickly asrnthe weather warms up.  May’s 8.8 percentrnyear-over-year growth rate is down almost three percentage points from justrnthree months ago.  The influences ofrnmodestly rising inventory and less-than-expected demand are causing pricerngrowth to moderate toward our forecasted expectations.”

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