Seattle House Prices Hit A Wall – Los Angeles, New York & Chicago Hit 0% Real Appreciation

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Seattle was by far the hottest housing market in the United States in 2017. Seattle house prices increased 14% from May 2017 to May 2018. The next 12 months, however, Seattle house prices fell 1%.

California metro housing markets are also slowing dramatically. San Francisco house prices increased only 1% and Los Angeles house prices increased only 2% from May 2018 to May 2019. The previous 12 months, they had increased 11% and 8%, respectively, according to my analysis of the latest numbers from the S&amp;P CoreLogic Case-Shiller Home Price Index.

The West Coast may be slowing the fastest but all of the 20 metro areas covered by Case-Shiller saw their house price appreciation slow down over the last 12 months.

House price appreciation for the United States as a whole fell from 6% to 3%.

Looking at inflation-adjusted house prices, the strongest real estate markets were in Las Vegas and Phoenix, next door to deflating Southern California. Real Las Vegas prices were up 5%, and real Phoenix prices were up 4% over the last 12 months.

Real prices fell 3% in Seattle. San Francisco and San Diego prices were down 1%. Three cities saw no real house price appreciation — Chicago, New York and Los Angeles.

On Wednesday, the Federal Reserve cut the fed funds rate by 0.25% but it had no immediate effect on mortgage rates because the cut was widely expected. The rate cut was the first since the Great Recession was in full swing.

Even though the U.S. economy is hot right now and the unemployment rate is the lowest in 50 years, the rate cut reflects worries the entire economy will follow the housing market and begin to slow down. The rate cut may strengthen the housing market and the entire economy and delay the next recession. Many economists were forecasting the next recession to begin next year.

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Seattle was by far the hottest housing market in the United States in 2017. Seattle house prices increased 14% from May 2017 to May 2018. The next 12 months, however, Seattle house prices fell 1%.

California metro housing markets are also slowing dramatically. San Francisco house prices increased only 1% and Los Angeles house prices increased only 2% from May 2018 to May 2019. The previous 12 months, they had increased 11% and 8%, respectively, according to my analysis of the latest numbers from the S&P CoreLogic Case-Shiller Home Price Index.

The West Coast may be slowing the fastest but all of the 20 metro areas covered by Case-Shiller saw their house price appreciation slow down over the last 12 months.

House price appreciation for the United States as a whole fell from 6% to 3%.

Looking at inflation-adjusted house prices, the strongest real estate markets were in Las Vegas and Phoenix, next door to deflating Southern California. Real Las Vegas prices were up 5%, and real Phoenix prices were up 4% over the last 12 months.

Real prices fell 3% in Seattle. San Francisco and San Diego prices were down 1%. Three cities saw no real house price appreciation — Chicago, New York and Los Angeles.

On Wednesday, the Federal Reserve cut the fed funds rate by 0.25% but it had no immediate effect on mortgage rates because the cut was widely expected. The rate cut was the first since the Great Recession was in full swing.

Even though the U.S. economy is hot right now and the unemployment rate is the lowest in 50 years, the rate cut reflects worries the entire economy will follow the housing market and begin to slow down. The rate cut may strengthen the housing market and the entire economy and delay the next recession. Many economists were forecasting the next recession to begin next year.