KEY MARKET INDICATORS as of April 16, 2019
Slower Home Price Growth – Case-Shiller Edition
The slowdown in the housing market in the second half of 2018 saw many potential buyers staying on the sidelines. The remaining buyers had a wide selection of homes to choose from and more leverage over sellers. As a result, home price growth also slowed during this period. The Case-Shiller home price index, which trackes home prices in 20 major cities captured this slowdown. It showed that home price growth slowing from 6.4% y/y growth in January 2018 to 3.6% in January 2019, the slowest growth rate since the beginning of the current housing market expansion. This slowdown mirrors the 2014-episode, when a sharp increase in interest rate and double-digit growth in home prices drove buyers away. The recent slowdown in home price growth is most pronounced in the following 11 cities, which are generally less affordable than the national average. In some markets such as Seattle, San Diego, Los Angeles, and San Francisco, the slowdowns were sharp. In other markets, such as Dallas and Portland, the slowdowns were more gradual and began earlier. While it may cause some short term uncertainty, slower home price growth and lower interest rates are both very positive for housing affordability, and will put the housing market on a sounder footing in the long run.
Don’t Miss A Weekly Economic Report → Subscribe To The Genworth MI Blog Today!
Disclaimer: Opinions, estimates and projections in this report constitute the current judgment of the author as of the date of this report. They do not necessarily reflect the opinions of Genworth Mortgage Insurance and are subject to change without notice. Genworth Mortgage Insurance has no obligation to provide revised assessments and assumes no duty to update information in the event of changed circumstances. While we have gathered this information from sources believed to be reliable, Genworth Mortgage Insurance cannot guarantee the accuracy of the information provided. Certain data discussed in this report is publicly available only on a time delayed basis. Genworth Mortgage Insurance strives to analyze data as it becomes available, but makes no representation that all data is reviewed immediately upon release.