U.S. Home Prices Reached an All-Time High This Summer

The weather wasn’t the only thing heating up this summer.

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Home prices in the U.S. soared to a record high in June, according to the S&P CoreLogic Case-Shiller National Home Price Index, CNBC reported . On an annual basis, prices across the country were up 5.4 percent compared to the same time last year. Of the 20 cities analyzed in the report, New York had the highest increase with home prices rising 9 percent in June. San Diego was close behind with an annual increase of 8.7 percent while Las Vegas followed, clocking an 8.5 percent uptick.

“New York has the largest divergence between low- and high-tier prices,” said Brian Luke, head of commodities, real and digital assets at S&P Dow Jones Indices. “Conversely, San Diego has seen the largest appreciation in higher-tier homes over the past five years.”

Despite the recent increase in home prices , the Federal Reserve has signaled that it could drop mortgage rates as soon as September. If you recall, back in 2020 and 2021, 30-year interest rates fell below 3 percent. However, that all changed amid a wave of inflation, which sent rates soaring above 8 percent in late 2023. But luckily, things are starting to cool off—and at a rate faster than expected.

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“The time has come for policy to adjust,” said Federal Reserve chair Jerome Powell during the central bank’s annual gathering. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”

With interest rates expected to fall—they currently sit between 5.25 and 5.5 percent—it’s likely would-be property shoppers will resume their home search. In a recent poll from May, a whopping 71 percent of first-time buyers said they wouldn’t enter the market until interest rates dropped. However, some are still holding out amid elevated home prices.

“Mortgage rates have fallen since June, but there is evidence that even the decline in rates has not been enough to bring buyers back into the market,” Lisa Sturtevant, chief economist at Bright MLS, told CNBC. “Some buyers are waiting for home prices—and not just interest rates—to come down.”

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