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US home price gains slow in May

US home prices rose in May at their slowest annual pace since February 2013, underscoring weakness in the housing market, the S&P Case-Shiller index showed on Tuesday (July 29).

WASHINGTON: US home prices rose in May at their slowest annual pace since February 2013, underscoring weakness in the housing market, the S&P Case-Shiller index showed on Tuesday (July 29).

The 20-city home price index rose at an annual rate of 9.3 per cent in May, down sharply from the 10.8 per cent increase in April. The year-over-year price gain came in well below the 10.0 per cent rate expected on average by analysts.

Price rises slowed in 18 of the cities in the index in May. Charlotte, North Carolina, was the only metropolitan area to see price gains pick up pace, to 4.7 per cent from 4.5 per cent in April. Tampa, Florida, held steady at a 10.2 per cent annual gain.

Month-over-month, the 20-city price index was up 1.1 per cent, matching April's gain, with all cities posting price increases for the second consecutive month.

David Blitzer, chairman of the index committee, noted the housing market's mixed performance in recent months, despite an improvement in the broader economy, especially in the labour market.

"Prices and sales of existing homes have shown improvement while construction and sales of new homes continue to lag," he said.

The housing market is struggling despite the slight fall in mortgage interest rates from a year ago.

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