CoreLogic has released its May Home Price Index, revealing another month of positive gains.

Marking 39 months of consecutive year-over-year gains, national home prices, both including and excluding distressed sales, increased 6.3 percent in May compared to the same time last year. The margin of increase shrunk considerably on a monthly basis, with prices, including distressed sales, inching up 1.7 percent and, excluding distressed sales, 1.4 percent.

Home prices dropped in Boston, falling 4.8 percent from the same time last year. Excluding distressed sales, prices slipped 2.2 percent.

Statewide, movement in price defined the lowest end up of the spectrum, falling further than any other market. Prices, including distressed sales, decreased 4.8 percentage points year-over-year, and, excluding distressed, 2 percent.

In recent years, prices both statewide and in Boston have outpaced wage growth, and with low inventories finding little upward momentum, a drop in home prices may actually turn out a positive. A return of affordability could push more buyers into the market, which would entice builders to start constructed starter homes and give homeowners more confidence to list their homes.

An Overall Positive Direction

Overwhelmingly, the national direction of home prices was positive, CoreLogic researchers found. Around the nation, only a small handful of markets fell into negative territory.

• Including distressed sales, the five states with the highest home price appreciation were: South Carolina (+10.3 percent), Colorado (+9.8 percent), Washington (+8.8 percent), Florida (+8.7 percent) and Nevada (+8.3 percent). Excluding distressed sales, the five states with the highest home price appreciation were: South Carolina (+9.6 percent), Colorado (+9.2 percent), Florida (+8.9 percent), Washington (+8.5 percent) and Oregon (+7.9 percent).
• Including distressed sales, only five states experienced home price depreciation including: Massachusetts (-4.8 percent), Connecticut (-1.8 percent), Maryland (-1.5 percent), Mississippi (-1.4 percent) and Louisiana (-0.8 percent).
• The five states with the largest peak-to-current declines, including distressed transactions, were: Nevada (-32.9 percent), Florida (-28.8 percent), Rhode Island (-27.5 percent), Arizona (-26 percent) and Maryland (-23.1 percent).

Mortgage Rates Drive Price Increases

In May, the pace of appreciation improved, and CoreLogic CEO and President Anand Nallathambi believes the higher rate could signal a future increase in new single-family construction.

“The rate of home price appreciation ticked up in May with gains being fairly widely distributed across the country. Importantly, higher home prices over the past couple of years have spurred increases in new single-family construction,” he said. Nallathambi noted that sales of newly built homes during the first five months of 2015 were up nearly one-quarter from the same time last year, adding, “We expect to see more existing homes offered for sale in the coming year.”

A main driver in the escalation of home prices, and the improved rate of appreciation, has been mortgage rates on 30-year fixed-rate loans, which remained below 4 percent throughout May, said Frank Nothaft, chief economist for CoreLogic. He added that rates maintained at current levels are helping to “fuel home-purchase activity.”