Home price growth in major U.S. metropolitan areas unexpectedly slowed in the month of June, according to a report released by Standard & Poor's on Tuesday.
The report said the S&P CoreLogic Case-Shiller 20-City Composite Home Price Index was up by 6.3 percent year-over-year in June compared to the 6.5 percent increase in May. Economists had expected the pace of price growth to remain unchanged.
On the monthly basis, the 20-City Composite Home Price Index rose by 0.5 percent in June after climbing by 0.8 percent in May.
The index inched up by just 0.1 percent in June after seasonal adjustment following a 0.2 percent uptick in the previous month.
"Home prices continue to rise across the U.S." says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. "However, even as home prices keep climbing, we are seeing signs that growth is easing in the housing market."
He added, "Sales of both new and existing homes are roughly flat over the last six months amidst news stories of an increase in the number of homes for sale in some markets."
Blitzer said the increase in 30-year fixed rate mortgages from 4 percent to 4.5 percent since January along with the rise in home prices is affecting housing affordability.
On Wednesday, the National Association of Realtors is scheduled to release its report on pending home sales in the month of July. Pending home sales are expected to rise by 0.4 percent.
A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.