Econintersect: CoreLogic's Home Price Index (HPI) shows that home prices in the USA in March 2014 are up 11.1% year-over-year (reported up 1.4% month-over-month). The year-over-year growth rate was down from the 12.2% reported last month.
This is the 25th consecutive month of year-over-year increase. Dr. Mark Fleming, chief economist for CoreLogic stated:
March data on new and existing home sales was weaker than expected and is a cause for concern as we enter the spring buying season. Interest rate-disenfranchised potential sellers are adding to the existing shadow inventory, while buyers who can't find what they want to buy are on the sidelines creating a new kind of 'shadow demand.' This supply and demand imbalance continues to drive home prices higher, even though transaction volumes are lower than expected.
Anand Nallathambi, president and CEO of CoreLogic stated:
Home prices continue to rise across the nation, but affordability, tight credit and supply concerns are becoming an increasing drag on purchase market activity. In many markets – especially major metro areas like Los Angeles, Atlanta and New York – home prices are being driven up at double-digit rates fueled by a lack of inventory and record levels of cash purchases.
Comparison of Home Price Indices - Case-Shiller 3 Month Average (blue line, left axis), CoreLogic (green line, left axis) and National Association of Realtors (red line, right axis)
The way to understand the dynamics of home prices is to watch the direction of the rate of change - and not necessarily whether the prices are getting better or worse. Home prices are improving - but the rate growth of year-over-year price improvement is now declining.
Year-over-Year Price Change Home Price Indices - Case-Shiller 3 Month Average (blue bar), CoreLogic (yellow bar) and National Association of Realtors (red bar)