New York and Cleveland have also seen big increases in prices
Chicago also led the U.S. in home-price growth for the fourth month in a row.
Chicago home prices are rising the fastest among the nation's biggest cities.
Nationally, home prices are rising at a slow pace, as housing inventory remains relatively low. But some markets, particularly in the Midwest, are seeing big gains.
Even though home prices are rising, the broader housing market is in a deep slowdown. Homes are selling less briskly than they did in years past, as high prices and elevated mortgage rates make homeownership expensive. Limited housing supply has also driven up prices, as fewer people are interested in selling their homes than before and during the pandemic.
Nationally, home prices grew 1.5% in June as compared with the same month a year ago, according to new data from the S&P Cotality Case-Shiller Index. The previous month saw a 1.2% annual gain.
Prices are also rising slightly faster in America's biggest cities. Homes in the 20-city index posted a 2.1% annual gain in June, up from a 1.6% increase the previous month.
Within the 20-city index, Chicago saw prices rise the most, up 6.9% in June as compared with last year. New York and Cleveland saw price increases of 4.8% and 4.1%, respectively.
Chicago also led the U.S. in home-price growth for the fourth month in a row.
On the flip side, Seattle saw home prices fall the most. Prices in the city were down 2% in June from a year ago.
A big drop in the number of homes for sale is one reason Chicago prices are rising sharply. Active listings in the Chicago-Naperville-Elgin metropolitan area fell 7.8% in June as compared with a year ago, according to a separate report by real-estate platform Realtor.com.
The median sale price of a home in the Chicago metro area in June was about $407,000, up 4.6% from a year ago, according to a report by Illinois Realtors. In the city of Chicago, the median price of a home was about $427,500, up 6.9% from a year ago.
The drop in active listings in Chicago was in contrast to the national gain in housing inventory of about 1.9%. New listings in Chicago were also down 11.8% in June as compared with a year ago. Active listings refer to all the homes on the market for sale, while new listings refer to homes that have just been listed.
(Realtor.com is operated by News Corp subsidiary Move Inc.; MarketWatch publisher Dow Jones is also a subsidiary of News Corp.)
"This geographic divide reflects a years-long trend, with housing markets in the Northeast and Midwest regaining strength while many Western and Sunbelt markets soften," Rebecca Kaufman, associate director of commodities at S&P Dow Jones Indices, said in a statement.
City Change in home-price index from last year Chicago 6.90% New York 4.79% Cleveland 4.13% San Francisco 3.22% Boston 2.71% Miami 2.27% Composite-20 2.10% Minneapolis 1.89% Washington, D.C. 1.70% Los Angeles 1.39% San Diego 1.05% Charlotte, N.C. 0.52% Atlanta 0.27% Portland, Ore. -0.38% Dallas -0.66% Phoenix -0.88% Tampa -1.19% Denver -1.24% Las Vegas -1.90% Seattle -1.95% Detroit Not available
"The nearly 9-percentage-point gap separating Chicago and Seattle underscores how localized this housing cycle remains, with the Northeast and Midwest continuing to outperform on constrained inventory while several Western and Sun Belt markets keep softening under the weight of new construction competition," Anthony Smith, a senior economist at Realtor.com, said in a statement.
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