Housing prices bounce moderately in June, but July looks to be much worse

S&P/Case-Shiller composite 20 home prices rose 0.3% in June (consensus forecasts were looking for a 0.2% increase) and May's gain saw a slight upward revision. On a year-over-year basis, S&P/CS composite 20 home prices have risen 4.2%, a slowing from the 4.6% year-over-year increase reported for May (using not seasonally adjusted data).

Of the 20 metro areas, home prices rose in June in Chicago, Miami, New York, Washington D.C., Atlanta, Detroit, and Minneapolis (home prices fell or were flat in the other areas). On a year-over-year basis, home prices are above year-ago levels in all areas apart from Chicago, Las Vegas, Charlotte, Seattle and Tampa.

BOTTOM LINE

Other news organizations are reporting this as a huge positive for the market.  Don't buy it.  The tax credit ended and that was helping to prop up the buyers market.  However, we are heading into slow season for home purchases.  The tax credit likely stole potential buyers from future months and now the urgency will be gone.  CNBC reports, "This is the last hurrah for the tax credit," said Gary Shilling, president of A. Gary Shilling & Co. in Springfield, N.J. "The data we've seen for July suggests considerable weakness in both sales and prices."

Our expectation is that anyone who bought a home now will regret it when their home equity takes a hit as prices fall.  As we have said all along, now is a terrible time to be buying a home, unless you like losing equity money. 

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