Home prices continued to rise in June, but at a slightly slower pace than in the past. The S&P/Case-Shiller 20-City Home Price Index rose 6.3% from June 2017 to June 2018. This was slightly below the 6.4% expected and down from the 6.5% recorded in May. Month over month, prices rose 0.1% from May to June. “We are seeing signs that growth is easing in the housing market … 30-year fixed rate mortgages rose from 4% to 4.5% since January – and the rise in home prices are affecting housing affordability,” said David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices.
Americans attitudes surrounding the U.S. economy and its components soared to levels not seen in 18 years in August. The Conference Board reports that its Consumer Confidence Index increased in August to 133.4, up from 127.9 and above the 126.5 expected. Consumers' assessment of the business and labor markets rose, which suggests high confidence levels should continue to support healthy consumer spending in the near term.
Freddie Mac released its August forecast on the housing market showing that "ongoing supply and demand imbalances and weakening affordability conditions, particularly in markets out West, are expected to keep a lid on home sales growth through the rest of the year." Freddie Mac predicts that the 30-year fixed-rate mortgage will average 4.6% in 2018. The report also showed that total home sales are to increase modestly this year to 6.14 million while home price growth will rise 6%. In addition, total originations are forecasted at $1.655 trillion, down 8.4% from 2017.
Home prices rose year over year in June, albeit at a slower pace than previous months. Consumer Confidence soars.
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