US home prices in February rise at slowest annual rate since July 2012

US home prices increased at their slowest pace in more than a decade during the month of February.

The S&P CoreLogic Case-Shiller US National Home Price NSA Index rose 2.0% on an annual basis in February, the weakest annual increase since July 2012, when prices climbed 1.2% year over year.

After seven consecutive months of decline, the US National Home Price Index increased 0.2% month over month after seasonal adjustment.

"The Federal Reserve seems focused on its inflation-reduction targets, which suggests that interest rates may remain elevated, at least in the near term," S&P Dow Jones Indices Managing Director Craig Lazzara said.

Prices decelerate in top cities

Both the 20-City Composite and 10-City Composite indexes posted an annual increase of 0.4% in February, down from the previous month's increases of 2.6% and 2.5%, respectively.

The indexes each posted a month-over-month increase of 0.1% after seasonal adjustment.

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Miami once again posted the highest year-over-year rise in housing prices among the 20 cities in the index with a 10.8% increase. Miami has led the way for seven consecutive months.

In-state peer Tampa, where home prices rose 7.7% year over year, took the second spot. Atlanta rounded off the top three as home prices there climbed 6.6% in February from a year earlier.

Most homebuilder stocks positive

The majority of US homebuilder stocks saw a positive one-year total return as of April 24, with the industry median at 38.4%, according to S&P Global Market Intelligence data.

All the top five homebuilders posted a one-year total return of more than 50%. Meritage Homes Corp. emerged as the best-performing homebuilder stock, with the company's one-year total return reaching 60.0%.

Hovnanian Enterprises Inc. took the second spot with a one-year total return of 56.7%. The homebuilder sold 5,302 homes as of Jan. 31, down 11.5% year over year.

D.R. Horton Inc. led the way as the homebuilder that sold the most homes among the top five companies in the last 12 months. D.R. Horton sold 81,524 homes as of March 31, down 0.3% from the year-ago period.

New single-family home sales rise in 3 out of 4 regions

In March, new single-family home sales grew 9.6% month over month to a seasonally-adjusted annual rate of 683,000 units but were down 3.4% from a year ago, according to data from the US Census Bureau and the US Department of Housing and Urban Development.

Three out of four regions in the country experienced a monthly increase in sales of new single-family homes. The Northeast region had the steepest increase as new home sales increased by 170.8% from the previous month.

Meanwhile, the South was the only region to experience a decline as new single-family home sales fell by 5.4%.

In an April 20 research note, National Association of Realtors Chief Economist Lawrence Yun stated that more supply is needed to fully satisfy housing demand. While home sales are still recovering and remain highly sensitive to mortgage rate changes, starter homes continue to receive multiple offers, Yun wrote.

"Home prices continue to rise in regions where jobs are being added and housing is relatively affordable," Yun said.

Existing home sales declined by 2.4% to 4,440,000 units in March compared to the previous month and were 22.0% lower than a year earlier, according to the National Association of Realtors.