WASHINGTON (10/1/14)--Home-price appreciation continues to slow down on an annual basis, as home prices only rose 6.7% from their year-ago levels in July, compared with an 8.1% jump year-over-year in June, according to the S&P/Case-Shiller Home Price Indexes (Economy.com Sept. 30).
Further, on a seasonally adjusted month-to-month basis, both the 10- and 20-city indices retreated 0.5% in July, which is the second straight month of decline and the biggest drop since October 2011 (MarketWatch Sept. 30).
"Mortgage applications are stuck at a historically low level, and first-time homebuyers have yet to enter the market in full force," said Gregory Bird, Moody's analyst (Economy.com). "In addition, investor demand is waning as fewer local housing markets are undervalued now compared with several years ago.
"On the supply side, the support to house prices from a falling share of distress sales to total home sales has begun to wane," Bird added.
On a positive note, every metro area covered by the index experienced annual price growth, according to Moody's. The increases ranged from 0.9% in Cleveland to 12.8% in Las Vegas.
But Las Vegas, Dallas and Charlotte, N.C., were the only metro regions to see monthly price gains. The largest declines occurred in Chicago, Minneapolis, Detroit and San Francisco.
"The geographic breadth of the pullback in prices is noteworthy," said Stephen Stanley, Pierpont Securities chief economist (MarketWatch). "Apologies if you are looking to sell your home, but perhaps a bit of relief on the price side will help to bolster housing demand, which has been disappointing lately."