Home-price gains have leveled off in major cities across the country, though the Portland area has emerged among the metros where prices are growing most rapidly.
Home values climbed 1.1 percent from April to May in 20 major cities around the country, new numbers from the Standard & Poor's/Case-Shiller home price index showed Tuesday. They reached a level 4.9 percent higher than in May 2014.
In Portland, home prices were up 1.4 percent in May, reaching a level 7.4 percent higher than a year ago. Of the 20 cities included in the survey, only Denver, Dallas, Miami, San Diego and San Francisco saw larger year-over-year increases.
The index suggests that home prices have leveled off. But market observers suggest that without an infusion of first-time homebuyers, so far mostly absent from the housing recovery, there's little room for prices to pick up steam.
The perceived strength of the housing market has come from buyers competing for a small number of homes for sale, bidding prices higher. But even as prices have increased, there hasn't been enough new inventory hitting the market to meet demand, and that's constrained sales.
David M. Blitzer, chairman of the index committee, said that first-time homebuyers provide the liquidity for current homeowners to trade up. Until the first-time buyers begin to show up in force, the supply issues will continue, he said.
"As home prices continue rising, they are sending more upbeat signals than other housing market indicators," Blitzer said. "Over the next two years or so, the rate of home price increases is more likely to slow than to accelerate."
A long-expected increase in mortgage interest rates could further hold down home prices, said Stan Humphries, the chief economist at the real estate website Zillow.
"Enjoy summer while it lasts, because in just a few months, things could start getting interesting again," Humphries said.
The Case-Shiller index uses repeat sales of the same property to measure changes in home values over time. Each month's data uses a three-month rolling average, and it's released on a two-month delay.
— Elliot Njus