The rapid slowdown in US home price growth is accelerating with Case-Shiller reporting a 5.03% YoY gain in October - the weakest since Nov 2016. Slowing for the 7th month in a row, if printing modestly above expectations of 4.80%, home prices rose 5.03% Y/Y, down from 5.21% a month ago, and confirming that the US housing market is clearly suffering:
Perhaps of greater note, the index of home prices actually declined MoM - the biggest drop since Jan 2016...
Despite the ongoing slowdown, all 20 cities in the index showed year-over-year gains, led by a 12.8% increase in Las Vegas (down from 13.5% last month), and almost 8% increases in both San Francisco and Phoenix. The weakest gains were in Washington, which rose 2.9 percent on year, Chicago, which climbed 3.3 percent, and New York, up 3.1 percent.
However, more dangers emerged on a month-over-month basis where prices fell in 8 cities, including Chicago (-0.3%), Cleveland (-0.5%), Denver (-0.3%), Minneapolis (-0.1%), Portland (-0.6%), San Diego (-0.1%), San Francisco (-0.7%) and Seattle (-1.1%).
Finally, much like NAR did this month, even the establishment hopefuls are admitting defeat: "The combination of higher mortgage rates and higher home prices rising faster than incomes and wages means fewer people can afford to buy a house. Fixed rate 30-year mortgages are currently 4.75%, up from 4% one year earlier. Home prices are up 54%, or 40% excluding inflation, since they bottomed in 2012" said David Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices.
He added that "Reduced affordability is slowing sales of both new and existing single family homes. Sales peaked in November 2017 and have drifted down since then."
Realtors, academics, and bullish shareholders are now joining the chorus of Trump demanding Powell put a hold on rate hikes.