The pace of annual home price gains further dwindled to 4.9% in May, according to the latest U.S. Home Price Insights (HPI) report from CoreLogic.
It’s the first time all year that year-over-year price growth as measured by CoreLogic’s HPI has fallen below the 5% threshold. May’s yearly increase is the lowest since October’s 4.7% uptick, though it still marks the 148th straight month of annual price growth.
Month over month, prices are up 0.6%.
Slowing price gains are spreading to more areas of the country, though the nationwide market remains geographically bifurcated by factors such as affordability and supply, said Selma Hepp, CoreLogic’s chief economist.
“While national annual home price growth continues to slow as anticipated, cooling appreciation over the past months is now observed in more markets, as the surge in mortgage rates this spring caused both slowing homebuyer demand and prices. However, persistently stronger home price gains this spring continue in markets where inventory is well below pre-pandemic levels, such as those in the Northeast.”
At 12% year over year, New Hampshire was the only state to post a double-digit price increase. New Jersey and Rhode Island saw the second highest annual gain at 9.8% each.
“Also, markets that are relatively more affordable, such as those in the Midwest, have seen healthy price growth this spring,” Hepp added. “On the other hand, markets with notable inventory increases, including those in Florida and Texas, continue to see annual deceleration that is pulling prices below numbers recorded last year.”
Of the five markets identified by CoreLogic as most at risk of home price drops in May, three were in Florida: Palm Bay-Melbourne-Titusville, Gainesville and North Port-Sarasota-Bradenton. CoreLogic rated all three at a “very high” risk, with more than a 70% probability of a price decline.
The Sunshine State’s largest city, Miami, seems to be one of the few Florida metros where price growth remains stout. Among the Top 10 metros tracked by CoreLogic, Miami’s 8.5% annual price gain was exceeded only by San Diego, which saw prices pick up 9.2% from May 2023.
CoreLogic expects national price growth to continue to soften, projecting a 3.0% annual increase from May 2024 to May 2025.
