The Case-Shiller index reported that home prices grew just 6.2 percent in June compared with a year earlier. All 20 cities the index tracks saw price gains slow down in the month, the first time that’s happened since February 2008.
In Los Angeles, prices grew 10.5 percent year over year, Case-Shiller says. That’s a relatively strong gain, but far slower than the pace seen a year ago. From May to June, prices in LA climbed 0.6 percent, barely half as fast as they did from April to May. Nationally, prices grew 0.9 percent in June compared with May.
This trend of slowing but not falling prices, taken with other measures of the market, is probably a healthy thing, analysts say.
“Home price gains continue to ease as they have since last fall,” says David Blitzer, chairman of the index committee at S&P Dow Jones Indices. “Other housing indicators—starts, existing home sales and builders’ sentiment—are positive. Taken together, these point to a more normal housing sector.”
The slowdown could continue in the coming months, especially if the Federal Reserve raises interest rates early next year, Blitzer predicted.
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