Home prices may be on the verge of cooling off

After rising steadily since January, home prices may now be turning lower again.

After rising steadily since January, home prices may now be turning lower again.

The latest read on home prices shows they hit another all-time high in July, rising 2.3% from the same month last year, according to Black Knight.

That’s a bigger annual gain than the roughly 1% recorded in June, and August’s annual comparison will likely be even larger because prices began falling hard last August.

A for sale sign in front of a home in Arlington, Va., on Aug. 22, 2023. Andrew Cabellero-Reynolds / AFP - Getty ImagesBut prices weakened month to month, according to Black Knight. While still gaining, which they usually do at this time of year, the gains fell below their 25-year average. This after significantly outdoing their historical averages from February through June. It’s a signal that a slowdown in prices may be underway again.

“In addition to monthly gains slowing below long-term averages, Black Knight rate lock and sales transaction data also points to lower average purchase prices and seasonally adjusted price per square foot among recent sales,” said Andy Walden, vice president of enterprise research at Black Knight. “All of these factors combined underscore the need to focus on seasonally adjusted month-over-month movements rather than simply relying on the traditional annual home price growth rate.”