Home prices jump as sales level off

WASHINGTON Home prices climbed steadily in July even as sales have slowed, evidence that a limited supply of houses is distorting the real estate market.

The Standard & Poor’s CoreLogic Case-Shiller national home price index, released Tuesday, rose 5.9 percent in July from a year earlier, slightly faster than June’s 5.8 percent annual pace.

Sales of both new and existing homes slipped over the summer, which typically might slow price gains. But demand remains strong and has created bidding wars among house hunters, pushing up prices at a much faster pace than incomes. The number of existing homes for sale fell 6.5 percent in the past year.

Seattle, Portland, Oregon and Las Vegas saw the largest increases, with prices in Seattle soaring 13.5 percent in July from a year earlier.

Sales of new homes slumped 3.4 percent in August, the second straight monthly decline.

The Commerce Department says sales dropped to a seasonally adjusted annual rate of 560,000. This comes after a 5.5 percent decline in July. Still, sales gains earlier this year mean that sales are running 7.5 percent higher year-to-date than in 2016.

A shortage of homes for sale coupled with rising prices has turned affordability into a challenge. Fewer new homes priced below $200,000 are coming onto the market. New homes at these relatively affordable prices were 14 percent of sales in August, down from 17 percent in 2016 and 19 percent in 2015.

The median sales price increased 3.7 percent in the past 12 months to $368,100.