Rise in home prices slowing down

The most recent data on home prices in 20 U.S. cities showed the slowest rise in four years, according to the S&P CoreLogic Case-Shiller index of property values.

The data for the 20 cities covers eight months in row as of November 2018. The index increased 4.7 percent year over year. In the prior month, the rise in prices over the prior 12-month period was 5 percent.

Despite the slowdown in the rise, all 20 cities in the index had increases year-over-year. The highest increases were 12 percent in Las Vegas and 8.1 percent in Phoenix.

The weakest gains were in Washington, Chicago, and San Diego, and New York had a rather small increase of 3.5 percent.

Based on the national index, the rise in home prices also slowed to 5.2 percent.

The seasonally adjusted 20-city index rose only 0.3 percent over the prior month, below the 0.4 percent median estimate. In Cleveland, San Francisco and Seattle, prices fell from the prior month on a seasonally adjusted basis.

Overall, the data demonstrates that the housing market is slowing down. Sales slowed as mortgage rates increased and the gain in home prices outpaced wage growth.

That said, more prospective buyers might move forward in the coming months, with price gains slowing down and mortgage rates falling, as well as a bigger supply of homes on the market. Early 2019 data shows that applications for loans to buy homes are rising.

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