Charlotte-area annual home appreciation rose in July at a slightly greater clip than the national average when compared with June, according to the S&P CoreLogic Case-Shiller Indices, considered a leading measure of U.S. home prices.
The data, released Tuesday, shows Charlotte home prices rose 5.3 percent from July 2015, following a 5.1 percent year-over-year gain in June. Nationally, home prices were up 5.1 percent year over year in July, up from a 5 percent annual gain in June.
Charlotte home appreciation slowed in month-over-month comparisons, to 0.4 percent in July from a 0.8 percent monthly gain in June. However, when the data is seasonally adjusted, the gains were 0.3 in both months.
Compared with the nation’s 20 largest metropolitan areas, Charlotte’s annual gains ranked 11th. The greatest increases were in Portland, Oregon, at 12.4 percent; Seattle, at 11.2 percent; and Denver, at 9.4 percent.
Price gains were more modest outside the Northwest. They rose just 1.7 percent in New York, 3.7 percent in Chicago and 5.5 percent in Los Angeles.
The latest report is further evidence that prices are being pushed higher by the limited inventory of homes on the market. That is hurting sales of both new and existing homes, despite buyer enthusiasm and historically low mortgage rates.
The national index is within 0.6 percent of its record high, set in July 2006.
“Given that the overall inflation is a bit below 2 percent, the pace is probably not sustainable over the long term,” said David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices, in the report. “The run-up to the financial crisis was marked with both rising home prices and rapid growth in mortgage debt. Currently, outstanding mortgage debt on one-to-four family homes is 12.6 percent below the peak seen in the first quarter of 2008 and up less than 2 percent in the last four quarters. There is no reason to fear that another massive collapse is around the corner.”
Charlotte is one of seven of the 20 largest cities that have surpassed their previous highs.
However, despite a 22.7 percent year-over-year drop in inventory in the Charlotte region, home sales in August were up sharply, 7.9 percent from July and 10.4 percent from August 2015, according to the Charlotte Regional Realtor Association. And homes are moving quickly: For the first time since the recession, days on the market fell below 100, to 97 in August. In Uptown, the average number of days on the market was 80.
“With inventory still very tight, the pressure on home prices is all to the upside,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in a research note.
The Commerce Department reported Monday that new home sales fell 7.6 percent in August. And the National Association of Realtors said last week that sales of existing homes nationally slipped 0.9 percent in August. Inventory collapsed 10.1 percent from a year ago to 2.04 million homes.
The Case-Shiller 20-city price index plunged after the housing bubble started to burst in 2006, plummeting by more than a third before hitting bottom in March 2012. Since then, prices are up 42.4 percent. But they remain 7.6 percent below the peak reached in July 2006.
In Charlotte, home prices are up 31 percent since hitting a trough in January 2012. Charlotte’s homes didn’t lose as much value as in many other cities during the recession; from the peak of the bubble, Charlotte’s home prices had fallen 20 percent by January 2012, according to the Case-Shiller data.
The indices are produced by CoreLogic and published by the S&P Dow Jones Indices, and are a comparison with a base value of 100 created in January 2000. In July, the Charlotte region’s index stood at 141.6.
Paul Wiseman, AP Economics Writer, contributed to this report