U.S. housing prices increased at a slower pace in February, a sign that several years of outsized gains in home values have created affordability challenges in several metro areas.
The S&P CoreLogic Case-Shiller 20-city home price index rose 3 percent from a year earlier, down from an annual gain of 3.5percent in January.
Following the harm from the 2008 financial crisis began to fade, home values always outstripped wage growth and started to climb in 2012. This made it harder for would-be buyers to save for existing property owners and a deposit to upgrade to a more expensive home.
Cost increases were strongest in the Sunbelt, a shift from past years where the gains came in West Coast cities like Seattle and San Francisco. Last Vegas reported the most significant price increase at 9.7 percent, followed closely by Phoenix in 6.7% and Tampa using a 5.4%.
Important California metro areas lost much of the momentum. These profits are now under the gains in nationwide average hourly earnings, which the Labor Department has reported are up 3.2 percent.