- U.S. home prices posted a 4.7% year-over-year gain in June, with only one state posting double-digit gains.
- By summer 2025, prices are predicted to slow to 2.3% as home price growth continues to slow
- In June, home prices were up only 0.3% from the month before, half the rate of seasonal increase seen in June in the years prior to the pandemic
- Miami once again usurped San Diego in June for the metro with the greatest price growth.
IRVINE, Calif. — (BUSINESS WIRE) — August 6, 2024 — CoreLogic®, a leading global property information, analytics and data-enabled solutions provider, today released the CoreLogic Home Price Index (HPI™) and HPI Forecast™ for June 2024.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20240806885236/en/
Figure 1: HPI & HPI Forecast % Change YoY (Graphic: Business Wire)
U.S. year-over-year home price gains inched down, reaching 4.7% in June, falling further from the previous month’s 4.9% in what will likely be a continual slide throughout the next year. Although June marked the 149th consecutive month of annual growth, the rate of growth is expected to decrease by more than half of its current rate, with prices expected to grow by only 2.3% on a year-over-year basis next summer.
Month over month, home prices rose just 0.3% from May to June. The CoreLogic HPI Forecast indicates that prices will repeat that pattern, rising by 0.3% again from June 2024 to July 2024. In the years prior to pandemic, monthly gains from May to July generally saw stronger increases. The cooling of monthly gains during the spring home-buying season reflects the impact of high mortgage rates on home buyers’ budgets and constraint on affordability.
While no states posted annual home price declines in June, only one – South Dakota – posted double-digit growth, coming in at 10%. Behind South Dakota, the other states with the highest increases year over year were New Jersey (9.3%), Rhode Island (9.2%), Connecticut (8.5%), and New Hampshire (8.2%).
Home prices in the 10 select large U.S. metros from June 2023 to June 2024 revealed that Miami posted the highest gain at 10% year over year. San Diego and Las Vegas tied for second at 7.5%, with Chicago coming in third at 7.2%.
The continued decline in the pace of appreciation can be linked to elevated mortgage rates. Although the Federal Reserve Board is anticipated to cut rates in September, high interest rates continue to affect affordability, and several markets in the South continue to see inventory increases that are pulling prices below last year’s numbers.
Housing market activity essentially froze at the end of the spring homebuying season as high mortgage rates continued to compress affordability and dissuade potential homebuyers, said Dr. Selma Hepp, chief economist for CoreLogic. “The 0.3% gain in prices from the month before was less than half the increase seen between May and June prior to the pandemic, when the gains averaged 0.8%. In addition, cooling home prices continued to spread across more markets, and nine states reported a monthly decline, up from three states last month. The April surge in mortgage rates notably weighed on consumer sentiment, and consumers increasingly chose to respond to the anticipation of a lower mortgage rate environment later this year.”
Top Takeaways:
- U.S. single-family home prices (including distressed sales) increased by 4.7% year over year in June 2024 compared with June 2023. On a month-over-month basis, home prices increased by 0.3% compared with May 2024.
- CoreLogic’s forecast shows annual U.S. home price gains relaxing to 2.3% in June 2025.
- Miami posted the highest year-over-year home price increase of the country's 10 highlighted metro areas in June, at 10%. San Diego and Las Vegas came in second at 7.5%.
- Among states, South Dakota ranked first for annual appreciation in June (up by 10%), followed by New Jersey (9.3%) and Rhode Island (9.2%), No state recorded a year-over-year home price loss.
The next CoreLogic HPI press release, featuring July 2024 data, is scheduled to be issued on September 3, 2024, at 8 a.m. EST.
Methodology
The CoreLogic HPI™ is built on industry-leading public record, servicing and securities real-estate databases and incorporates more than 45 years of repeat-sales transactions for analyzing home price trends. Generally released on the first Tuesday of each month with an average five-week lag, the CoreLogic HPI is designed to provide an early indication of home price trends by market segment and for the Single-Family Combined tier, representing the most comprehensive set of properties, including all sales for single-family attached and single-family detached properties. The indices are fully revised with each release and employ techniques to signal turning points sooner. The CoreLogic HPI provides measures for multiple market segments, referred to as tiers, based on property type, price, time between sales, loan type (conforming vs. non-conforming) and distressed sales. Broad national coverage is available from the national level down to ZIP Code, including non-disclosure states.
CoreLogic HPI Forecasts™ are based on a two-stage, error-correction econometric model that combines the equilibrium home price—as a function of real disposable income per capita—with short-run fluctuations caused by market momentum, mean-reversion, and exogenous economic shocks like changes in the unemployment rate. With a 30-year forecast horizon, CoreLogic HPI Forecasts project CoreLogic HPI levels for two tiers — Single-Family Combined (both attached and detached) and Single-Family Combined Excluding Distressed Sales. As a companion to the CoreLogic HPI Forecasts, Stress-Testing Scenarios align with Comprehensive Capital Analysis and Review (CCAR) national scenarios to project five years of home prices under baseline, adverse and severely adverse scenarios at state, metropolitan areas and ZIP Code levels. The forecast accuracy represents a 95% statistical confidence interval with a +/- 2% margin of error for the index.
About Market Risk Indicators
Market Risk Indicators are a subscription-based analytics solution that provides monthly updates on the overall health of housing markets across the country. CoreLogic data scientists combine world-class analytics with detailed economic and housing data to help determine the likelihood of a housing bubble burst in 392 major metros and all 50 states. Market Risk Indicators is a multi-phase regression model that provides a probability score (from 1 to 100) on the likelihood of two scenarios per metro: a >10% price reduction and a ≤ 10% price reduction. The higher the score, the higher the risk of a price reduction.
About the Market Condition Indicators
As part of the CoreLogic HPI and HPI Forecasts offerings, Market Condition Indicators are available for all metropolitan areas and identify individual markets as overvalued, at value or undervalued. These indicators are derived from the long-term fundamental values, which are a function of real disposable income per capita. Markets are labeled as overvalued if the current home price indexes exceed their long-term values by greater than 10% and undervalued where the long-term values exceed the index levels by greater than 10%.
Source: CoreLogic
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