CoreLogic has released its CoreLogic Home Price Index (HPI) and HPI Forecast for July 2024.
U.S. year-over-year home price gains inched down, reaching 4.3% in July, falling further from the previous month’s 4.7% and resting below 5% for the third consecutive month. On a month-over-month basis, home prices decreased by 0.01% in July 2024 compared with June 2024. We will likely see home prices continue to slide for the remainder of the year as sales across the country slow. Although July marked the 150th consecutive month of annual growth, monthly home price growth is starting to slip, and annual forecasts are showing smaller anticipated gains. By August, home prices are forecast to rise only 0.2%, and next year, prices will inch up by 2.2%.
Much of this sluggishness can be attributed to high mortgage interest rates that are continuing to challenge the housing market. As buyers remain cautious, sales remain low. However, the highly anticipated rate cuts from the Federal Reserve this fall may help improve consumer purchase sentiment for the housing market.
“Housing demand continued to buckle under the pressure of high mortgage rates and unaffordable home prices, leading to a considerable slowing of home price gains during the summer. July’s prices were essentially flat from the month before, which was notably cooler than the average gain of 0.4% recorded between June and July in years prior to the pandemic and especially during the pandemic,” said Dr. Selma Hepp, Chief Economist for CoreLogic. “The question for home prices going forward is whether the upcoming rate cut from the Fed and expected continuation of falling mortgage rates will be sufficient to motivate potential homebuyers who may start to fear cooling labor market and continued uncertainty of a soft landing, along with anticipation around the presidential election. And while lower mortgage rates are a boost to affordability and are likely to help buyer demand, the usual fall housing market slowdown is upon us and is likely to contain any significant surge in activity.”
Nationally, home prices increased by 4.3% year over year in July. No states posted annual home price declines. The states with the highest increases year over year were Rhode Island (10.6%), New Jersey (9.7%), Connecticut (8.3%), South Dakota (8.1%), and Illinois (7.5%).
A look at home price changes in 10 select large U.S. metros from July 2023 to July 2024 reveals that Miami again posted the highest gains, coming in at 9.1% year over year in July. Meanwhile, CoreLogic’s Market Risk Indicator (MRI) predicts that Gainesville, FL is at a very high risk of a decline in home prices over the next 12 months, with a 70%-plus probability. Palm Bay-Melbourne-Titusville, FL; Atlanta-Sandy Springs-Roswell, GA; and Lakeland-Winter Haven, FL; and Ogden-Clearfield, UT are also at very high risk for price declines.
Top Takeaways:
- U.S. single-family home prices (including distressed sales) increased by 4.3% year over year in July 2024 compared with July 2023. On a month-over-month basis, home prices decreased by 0.01% compared with June 2024.
- CoreLogic’s forecast shows annual U.S. home price gains relaxing to 2.2% in July 2025.
- Miami posted the highest year-over-year home price increase of the country’s 10 highlighted metro areas in July, at 9.1%.
- Among states, Rhode Island ranked first for annual appreciation in July (up by 10.6%), followed by New Jersey (9.7%) and Connecticut (8.3%). No state recorded a year-over-year home price loss.
The next CoreLogic HPI press release, featuring August 2024 data, is scheduled to be issued on October 1, 2024.
