Housing prices continue to rise, and while gains continue to shrink at national level in May, some markets are seeing a stronger price rise yet.
Nationally, house prices rose 3.4% annually in May, down from 3.5% annual gain in April, according to the S&P CoreLogic Case-Shiller price indices. The 10-city price composite rose 2.2%, down from 2.3% the month before. The 20-city composite showed a 2.4% annual gain, down from 2.5% in April.
Nationally, year-over-year home price gains were lower in May than in April, but not dramatic, and broad-based moderation continued, said Philip Murphy, CEO and Global Head of Index Management at S&P Dow Jones Indices in a release.
Other recent indices have shown that price gains grew. This particular reading is a three-month moving average that ends in May, so it's less relevant.
Housing prices in some major markets have heated up due to a close supply of homes for sale. Inventories had increased at the beginning of this year, but are now flat nationally and lower in some cities, compared to a year ago. Inventory is also most slim at the low end of the market, where demand is strongest.
The median existing home price in June peaked at $ 285,700, up 4.3% from June 2018 ($ 273,800), according to the National Association of Realtors.
The seven cities with home prices that received larger annual gains included San Diego; Washington DC .; Detroit; Minneapolis
Charlotte; and Cleveland.
Las Vegas, Phoenix and Tampa reported the highest year-over-year gain among the 20 cities in the Case Shiller Index. In May, Las Vegas saw a 6.4% year-on-year increase, followed by Phoenix with a 5.7% increase, and Tampa with a 5.1% increase. Seven of the 20 cities reported major price increases in the year ending May 2019 versus the year ending April 2019.
"Although home price gains seem generally sustainable for the time being, there are significant variations between YOY rates of change in individual cities," Murphy noted in the release . "Seattle's house price index is now 1.2% lower than it was in May 2018, the first negative [year-over-year] change recorded in a major city for a number of years. On the other hand, Las Vegas and Phoenix, while cooler than they were was in 2018, remain quite strong. "
The report shows a significant diversity in local price developments. Given that seven cities experienced stronger annual price gains in May than they did in April, if the stock of homes for sale is shrinking further, more cities could see the same turnaround in prices.