Home Prices Rise 12.4% in August but Monthly Gains Moderate
NEW YORK (TheStreet) -- Home prices continued to post strong annual increases but the pace of monthly gains reflects a slowdown in the housing recovery.
According to the latest report from CoreLogic, home prices rose 12.4% in August from a year earlier, the 18th consecutive annual increase. What's more, CoreLogic's Pending Home Price Index projects another 12.7% year-over-year gain in September.
Excluding distressed sales, the share of which has been declining, home prices rose 11.2% in August and are projected to show an annual gain of 12.2% in September.
But the month-over-month gains are moderating. Home prices rose 0.9% in August from July or by 1% excluding distressed sales. And the pending home sales index indicates a further slowdown in September, with home prices projected to rise by a muted 0.2% over August or 0.7% excluding distressed sales.
"After a strong run, the rate of home price appreciation slowed in August. In addition to normal seasonality, the recent sharp rise in mortgage rates off their historic lows was a clear driver behind the slowdown," said Anand Nallathambi, president and CEO of CoreLogic. "We anticipate moderate gains in home prices over the balance of this year, supported by the recent downward trend in rates and continued tight supplies of homes in many markets."
Excluding distressed sales, the five states with the highest year-over-year home price appreciation in August were Nevada (+23.4%), California (+19.8%), Arizona (+14%), Utah (+13.7%) and Florida (+13.5%).
-- Written by Shanthi Bharatwaj in New York.
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