WASHINGTON (AP) — U.S home prices rose at a slower pace in May, a sign that many would-be buyers are finding properties unaffordable.
The S&P CoreLogic Case-Shiller 20-city home price index increased 2.4% in May from a year earlier, according to a Tuesday report. Price growth decelerated slightly from the 2.5% year-over-year gain in April.
“Thwarted by climbing prices for years, buyers are no longer willing to pay any price,” said Matthew Speakman, an economist that real estate company Zillow. “There were too few homes on the market and buyers were unable to find houses that fit both their needs and their budgets, so they took a breather.”
The sluggish price growth stems largely from the most expensive markets, where years of price growth have undermined affordability. Home prices rose less than 2% in Los Angeles, New York, San Diego and San Francisco. Prices in the typically hot market of Seattle fell 1.2% from a year ago, a sharp reversal from an annualized gain of 13.6% in May 2018.
The strongest price gains were in Las Vegas at 6.4%, Phoenix at 5.7% and Tampa at 5.1%.
There were signs in a National Association of Realtors report on existing homes that prices may get some support from lower mortgage rates.