Home values in South Florida rose in April but the overall rate of growth continued to slow, suggesting that an overheated market is still cooling down.
“We rebounded from the recession much quicker than we expected,” said Tony Cho, president of the local brokerage and investment firm Metro 1. “There was a hyper-acceleration. We’re seeing it stabilize now, which is much healthier.”
Home prices in Miami-Dade, Broward and Palm Beach counties were up .6 percent in April compared to March, according to the S&P/Case-Shiller Home Price Indices, an important housing market indicator released Tuesday.
That’s lower than in the previous monthly report, which showed prices rising .9 percent between February and March.
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The decline fits in with a year-long trend: price gains are slowing down, a healthy sign of a more normal market. (Case-Shiller numbers are adjusted to account for seasonal changes.)
South Florida home values grew 8.5 percent between April 2014 and April 2015, the report found. During the previous year, prices in the tri-county area grew more than 14 percent as the housing market made up ground lost during the recession.
The surge in home prices far outpaced wage growth, helping contribute to a local affordable housing crisis.
“There is a silver lining in the slowdown,” said Susan Wachter, a professor of real estate at the Wharton School of the University of Pennsylvania. Prices and wages could fall more in line if the housing market cools down and Miami’s economy continues its strong growth, Wachter said.
“The bottom line is that Miami is continuing to do well,” Wachter said.
Home prices are still about 29 percent lower than they were during the peak of the real estate bubble in 2006.
Cities with greatest annual home price growth
Between April 2014 and April 2015
Source: S&P/Case-Shiller Home Price Indices