• The S&P CoreLogic Case-Shiller U.S. National Home Price Index® rose 18% year-over-year in June (non-seasonally adjusted), down from 19.7% in May.
• Annual growth was slower in June than May in both the 20-city index (to 18.6%, from 20.5%) and 10-city index (to 17.4% from 19.1%).
• Annual growth was faster in June than May in only one market included in the 20-city index.

As the summer took hold and temperatures rose along with mortgage rates, affordability challenges ravaged home buyer demand in June as the cost became too much of an obstacle for many buyers. The rebalancing that’s caused home values to dip slightly in Zillow’s latest reading was beginning to take hold in June. Many buyers find themselves priced out of the for-sale market, depressing sales counts and boosting inventory as homes linger on the market longer. While these are the first steps toward a more balanced market in the long run, these slowdowns in home value appreciation will take a while before they have any meaningful impact on buyers.

The national Case-Shiller Home Price Index rose 18% year-over-year in June, a slowdown from 19.7% in May. Annual appreciation also slowed in both the 10- and 20-city (non-seasonally adjusted) indices. The annual gain in the 10-city index fell from 19.1% in May to 17.4% in June, and for the 20-city composite index from 20.5% to 18.65%. From May to June, the national index (seasonally adjusted) rose 0.3%, while the 10- and 20-city indices were up 0.3% and 0.4%, respectively.

Even in markets that are seeing falling prices on a monthly basis, the dips are nowhere near enough to undo the rapid appreciation that occurred since the onset of the pandemic, meaning affordability remains a significant challenge. By the same token, homeowners aren’t at risk of seeing their equity depleting. The rest of the summer and into the fall will bring about more pronounced moves towards a rebalanced market, but the most significant impact would come from a true increase in inventory. But as new construction data from the past few months tells us, meaningful increases in the housing supply look unlikely for the near term.

Annual home price growth as reported by Case-Shiller are expected to slow in all three indices. Monthly appreciation in July is expected to accelerate. S&P Dow Jones Indices is expected to release data for the June S&P CoreLogic Case-Shiller Indices on Tuesday, September 27.

Note: Case-Shiller and Case-Shiller Index are registered trademarks of CoreLogic Solutions, LLC. The statements herein are not endorsed by or provided in association or connection with CoreLogic, LLC.