US home price growth slows in April

Tuesday 24 June 2014 15.36
Five US cities - Atlanta, Boston, Chicago, San Francisco and Seattle - had monthly house prices gains of at least 2%
Five US cities - Atlanta, Boston, Chicago, San Francisco and Seattle - had monthly house prices gains of at least 2%

US home price gains slowed sharply in April, providing fresh evidence of a weakness in the housing market recovery, the S&P Case-Shiller index showed. 

The 20-city index of home prices rose at an annual rate of 10.8% in April, following the 12.4% growth rate posted for March. Month-over-month, the index rose 1.1%.

The slowdown was seen in 19 of the 20 cities, with three California cities - Los Angeles, San Diego and San Francisco - posting hefty price drops of about three percentage points, year-on-year. 

Boston was the only city where the price gains picked up pace. 

The slowdown was stronger than expected. US analysts on average estimated the 20-city index would post an annual pace of 11.6%.

David Blitzer, chairman of the index committee, said that although the annual gains weakened, the month-over-month numbers were strong.

Five cities - Atlanta, Boston, Chicago, San Francisco and Seattle - had monthly gains of at least 2%. 

"Near-term economic factors favor further gains in housing: mortgage rates are lower than a year ago, the Fed is expected to keep interest rates steady until mid-2015 and the labour market is improving," he said.

"The question is whether housing will bounce back before the Fed begins to tighten some time next year," he added.