U.S. single-family home prices unexpectedly dropped in the month of May on a seasonally adjusted basis, missing expectations of a small gain.
The S&P/Case Shiller composite index of 20 metropolitan areas reported a decline of 0.3 percent in May Tuesday on a seasonally adjusted basis, while economist polled by Reuters had forecast a gain of 0.2 percent. The latest housing market data added to an already-grim picture of a weak sector.
Monday the National Association of Realtors reported contracts to buy previously-owned U.S. homes fell in June at double the pace expected by economists, adding to months of data showing a weak housing market. New home sales also fell dramatically in June and the prior month’s data was revised to show less growth.
Getting back to the S&P/Case Shiller index, non-seasonally adjusted prices rose 1.1 percent in the 20 cities, also missing expectations of a 1.5 percent rise.
“Housing has been turning in mixed economic numbers in the last few months,” David Blitzer, chairman of the index committee at S&P Dow Jones Indices said in a statement.
“Prices and sales of existing homes have shown improvement while construction and sales of new homes continue to lag.”
Prices in the 20 cities have increased by just 9.3 percent year over year, which is the weakest year-over-year gain since February 2013 and off of expectations for a 10 percent gain.
The seasonally adjusted 10-city gauge dropped by 0.3 percent in the month of May compared to the flat measurement in April. The non-adjusted 10-city index rose 1.1 percent in May versus to a 1 percent gain in April, while year-over-year, the 10 city gauge rose 9.4 percent.