Big bubbles! US home pricest hit an all-time high as The Fed keeps its foot on the monetary gas pedal following the Covid economic shutdown in 2020.
Home prices in America’s 20 largest cities rose for the 16th straight month in June (according to the latest data from S&P CoreLogic – Case Shiller – data today), up 0.42% MoM (hotter than expected and accelerating from May). On a YoY basis, prices rose 6.47%, but notably that is the third straight monthly slowdown in the pace of price appreciation…
Source: Bloomberg
Overall, US home prices reached a new record high in June (as median new home prices continued to tread water)…
Source: Bloomberg
Home prices continue to track Fed Reserves closely, but a turning point may come soon…
Source: Bloomberg
Given the smoothing and heavy lag in the Case-Shiller data, it’s hard to find a causal relationship between prices and mortgage rates…
Source: Bloomberg
But, with prices reaccelerating and mortgage rates already back below 7.00% – in anticipation of The Fed – WTF does Powell think is going to happen when he actually starts cutting with prices at these record highs.
The Freddie Mac HP index shows the variation in home price growth. New Jersey coastal towns of Atlantic City and Ocean City grew at 10% YoY while Lake Charles LA declined by -2% YoY.
