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The housing market's upward momentum may be cooling, but home prices nationally rose once again for the 13th consecutive quarter, according to the latest Home Price Index report from the Federal Housing Finance Agency.
FHFA reported Tuesday that U.S. house prices, based on home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac, rose 0.9 percent in the third quarter.
While that does show a continuation of the growth the U.S. market has enjoyed for the past three years, the rate of growth is down from 4.5 percent compared to the third quarter of 2013.
"[P]rice increases were relatively small in most areas ... and are consistent with the type of market deceleration that other housing market statistics have shown in recent periods," said Andrew Leventis, FHFA's principal economist.
Earlier this month, FNC reported that national home prices in September dropped by 0.3 percent, marking the first dip of its kind in nearly three years. FHFA's September index flattened with its August numbers (which, incidentally, were up by half a percent). Leventis attributed the third-quarter rise FHFA found to easing interest rates and modestly improving labor market conditions.
Though still down from a year ago, FHFA's Q3 index fared even better when accounting for sales reported through county recorder offices and the Federal Housing Administration. With these additional data sets, the FHFA index showed a 1.5 percent rise in national home prices. A year ago, this figure was 6 percent.
Nevada, which posted a 10 percent growth in home prices, topped the list of states that showed the greatest appreciation in Q3. California (where 11 of the 20 metropolitan areas with the highest annual appreciation rates were), Hawaii, and North Dakota posted rises of more than 8 percent, while Florida and Oregon hovered close to those same figures.
Price increases were greatest in the San Jose-Sunnyvale-Santa Clara market, where they increased by 6.6 percent. Prices were weakest in the Greensboro-High Point, North Carolina area, where they fell 4.4 percent.
Regionally, the West South Central Census division (Texas, Louisiana, Arkansas, and Oklahoma) was the strongest section for growth in the third quarter, according to FHFA. This section posted a 1.8 percent increase and a 5.8 percent increase since last year. House prices were weakest in the Middle Atlantic division (New York, New Jersey, and Pennsylvania), where prices increased 0.1 percent from the prior quarter.
