Home prices still rising fast, but shows signs of cooling

America's red-hot housing market is starting to cool as mortgage rates spike. Home prices in April rose 20.4% from a year ago, according to the latest S&P CoreLogic Case-Shiller Index, down slightly from an increase of 20.6% the previous month.

Abbey Omodunbi, senior economist for PNC Financial Services, attributed the dip to rising borrowing costs, fading consumer confidence and growing economic uncertainty as the Federal Reserve raises its benchmark interest rate in a move to tame inflation. 

In another sign the housing sector may have crested, sales of newly built homes and mortgage applications are also tumbling.  Homeowners nationwide are starting to lower their asking price as demand softens, Redfin reported last month. The average rate for a 30-year fixed mortgage today is 5.81%, according to Freddie Mac, up from 3.1% at the beginning of the year.