US home prices hit all-time highs

Black Knight today reported that June US house prices rose 0.67% in the month after a 0.80% rise in May. They say the trend points to a 2% y/y price increase in July, if not higher.

“At the national level, home prices have now fully erased their 2022 corrections
hitting new all-time highs in June on both seasonally adjusted and non-seasonally
adjusted bases,” Black Knight writes. ” In fact, 60% of markets are now seeing prices above 2022 levels.”

Weak spots include Austin, San Francisco, Phoenix and Las Vegas while Hartford, Milwaukee, Philadelphia and Cincinnati are all up strongly compared to last year. That represents some mean reversion as the hottest markets from the post-covid period cool and those that had smaller booms continue higher.

“Broadly speaking, Midwest and Northeast markets are seeing the highest
year-over-year price gains, while West Coast and pandemic boom markets
continue to see prices run below last year’s levels,” Black Knight writes. “Based on recent monthly trends, those West Coast markets are likely to
begin climbing the ladder again in coming months.”

US mortgage rates are back to the highs but delinquincies and foreclosures remain at very low levels.

A year ago I was a lonely voice in the wilderness predicting that US housing would be resilient while scores of economists were forecasting a crash. Here we are now with Fed funds likely at a peak and no crash in sight.