'The US housing market continues to cool'
Home prices fell 0.1% in May, a second-straight monthly decline, according to the S&P/Case-Shiller Home Price Index.
Before seasonal adjustment, the 20-city composite rose 1.2%.
Economists had forecast that the gauge of prices in 20 major US cities climbed 0.1% month-on-month on a seasonally adjusted basis, according to Bloomberg.
"The US housing market continues to cool, as May represents the fourth straight month of flat or decreasing year-over-year price gains," said Ralph McLaughlin, Trulia chief economist.
Still, buyer demand, boosted by low mortgage rates and job creation, should put off immediate concerns about the housing recovery. However, a shortage of inventory is keeping prices high and making entry-level homes less affordable.
House prices are rising at a 5% annual rate year-on-year and were expected to have increased by 5.52% in May. The pace is just about 3% from its all-time high.
At the same time, home sales are rising. They peaked in June at the highest annual rate since February 2007, when national home prices topped out before the housing crisis.
David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, gave a regional breakdown showing some shifting patterns: "Over the last year, the Pacific Northwest has been quite strong while prices in the previously strong spots of San Diego, San Francisco and Los Angeles saw more modest increases. The two hottest areas during the housing boom were Florida and the Southwest. "Miami and Tampa have recovered in the last few months while Las Vegas and Phoenix remain weak. When home prices began to recover, New York and Washington saw steady price growth; now both are among the weakest areas in the country."
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