Home prices slip in July as market tries to gain traction

Home price gains slipped in July to their slowest pace in nearly two years as the housing sector battles slow wage growth and an investor retreat.

Prices are up 6.7 percent since July 2013, the smallest yearly increase since November 2012, down from the 8.1 percent increase in June, according to the Standard & Poor’s/Case-Shiller 20-city home price index released Tuesday.

{mosads}Nationally, in a broader index, prices rose 5.6 percent above July 2013, after a 6.3 percent gain for the year in June.

“The broad-based deceleration in home prices continued in the most recent data,” says David Blitzer, chairman of the index committee at S&P Dow Jones Indices.

“However, home prices continue to rise at two to three times the rate of inflation.”

As of July, average home prices are back to their levels posted in spring 2005.

Blitzer said that the slower pace of home price appreciation is consistent with most of the other housing data on housing starts and sales.

The rise in August new home sales, which isn’t included in the index, “is a welcome exception to recent trends,” he said.

On a monthly basis, home prices in the 20-city index decreased 0.6 percent in July.

“While the year-over-year figures are trending downward, home prices are still rising month-to-month although at a slower rate than what we are used to seeing over the past couple of years,” Blitzer said.

Meanwhile, the national index showed a 0.5 percent monthly gain, its seventh consecutive increase.

Stagnant wage growth has been blamed for the economy’s woes even amid faster jobs growth.

While all cities except one — San Francisco — posted monthly gains, 17 had smaller increases in July compared with the previous month.

Nineteen of the 20 cities saw lower annual increases in July, with only three cities reporting double-digit annual gains.

Still, while all cities continue to continue to post year-over-year gains, none managed to show improvement.

Las Vegas, one of the cities hit hardest by the housing crash, had the highest gain of 12.8 percent over the year.

Miami’s prices rose 11 pecent and San Francisco’s were up 10.3, the only two other cities to report double-digit annual gains.

Phoenix, the first city to see double-digit gains in 2012, posted its lowest annual return of 5.7 percent since February 2012.

A separate report showed recently that sales of existing homes slipped in August after four months of gains because cash-paying investors reduced their purchases.

All-cash sales represented 23 percent of transactions in August, dropping for the second consecutive month from 29 percent in July.