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US national home price growth is trending lower and appreciation by summer 2025 could be less than half what it is today, according to a new report released this week.
The CoreLogic Home Price Index and HPI Outlook shows that, in June, growth was 4.7% year-over-year, down from 4.9% in May and part of a slowdown that is likely to continue for some time. The firm’s outlook is that prices will grow by just 2.3% year-over-year by summer 2025.
Although prices are still rising, June posted only a 0.3% increase month-over-month and the outlook calls for the same rate from June to July as high mortgage rates maintained barriers for many would-be homebuyers.
“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%,” said Dr. Selma Hepp, chief economist for CoreLogic. “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.”
South Dakota was the only state to see a double-digit annual price gain in June (10%) but some others came close and were above the national average including New Jersey (9.3%), Rhode Island (9.2%), Connecticut (8.5%), and New Hampshire (8.2%).
By large metro, Miami was the standout market with a 10% gain year-over-year followed by San Diego and Las Vegas (both 7.5%) and Chicago (7.2%).
While price growth has been slowing for some time, the average US homeowner still managed to grow their equity by $28,000 year-over-year in the first quarter of 2024.
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