Home Price Gains Begin to Slow

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Home price indices continued to rise during the most-recent month. But one HPI indicated the rate of increase is slowing, while a forecast
has a month-over-month dip ahead.

For September, the
Case-Shiller 20-City Composite Home Price Index was determined to be 203.50. That was 0.4 percent higher than the preceding month.

The index,
which is a measure of U.S. home prices based on a value-weighted average in 20 metropolitan areas, has gained 6.2 percent from the same month last year.

S&P Dow Jones Indices and CoreLogic Inc. released the home-price report on Tuesday.

David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, noted in the report that prices rose at the fastest annual rate since June 2014. He said most economic indicators point to further gains, though affordability continues to be a dark cloud on the horizon.

Historical data
indicate that the index now stands 52 percent higher than its March 2012. But home prices are still nearly 2 percent shy of the July 2006 peak.

In Seattle, home prices have escalated from a year earlier by 12.9 percent — more than any of the 20 metropolitan statistical areas tracked in the report.
No. 2 Las Vegas was up 9.0 percent, followed by 8.2 percent in San Diego, 7.3 percent in Portland and 7.2 percent in Boston, Denver and Tampa, Florida.

In the District of Columbia, prices were up 3.1 percent from September 2016 — the smallest year-over-year rise.

At 253.0, the Federal Housing Finance Agency’s HPI was 0.3 percent higher than in August and elevated by 6.3 percent compared to September of last year.

The report from the regulator had its third-quarter 2017 HPI up 1.4 percent from three months earlier and 6.5 percent higher than one year earlier.

“With relatively favorable economic conditions and a continued shortage of housing supply, price increases in the third quarter were generally robust and widespread,” FHFA Deputy Chief Economist Andrew Leventis said in the report. “At some point, declining housing affordability should temper appreciation rates in some of the nation’s fastest appreciating markets, but our third quarter results show few signs of that.”

FHFA’s index indicated September 2017’s home prices were up 8.7 percent on a year-over-year basis in the Pacific — more than any of the other nine Census Divisions. With just a 4.6 percent ascension, prices in the Middle Atlantic saw the smallest gains.

The Black Knight HPI Report September 2017 indicated the average U.S. home price was $282,000, inching up 0.2 percent from the prior month and 6.4 percent more than a year prior. The index, which was already in record territory, now stands 42 percent above its January 2012 trough.

In New York, Black Knight’s report had prices up 1.1 percent from August — the strongest month-over-month gain. Rhode Island increased 0.9 percent, followed by Florida’s 0.9 percent, Utah’s 0.9 percent and Montana’s 0.8 percent.

With an 0.6 percent decline from a month earlier, Michigan fared worst.

“The rate of monthly appreciation declined once again, falling by one-third from August and marking the sixth consecutive month of slowing growth,” Black Knight said. “Year-over-year growth, however, accelerated slightly in September.”

Earlier this month, CoreLogic
reported that its HPI had prices up 0.9 percent from August and 7 percent more than September 2016.

CoreLogic estimates that prices fell 0.1 percent between September and October of this year, though a 4.7 percent increase is predicted between September 2017 and September 2018.


Mortgage Daily Staff


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