- August home prices recorded gains of 0.4% month-over-month and 2.6% year-over-year.
- The highest price increases came in Northeast and Midwest markets, while the Southwest and West had the largest declines.
- Overall, homes in low and middle price tiers saw bigger gains compared to high tiers.
Home prices grow again, despite slowed sales
August home prices edged up 0.4% month-over-month, according to the October S&P CoreLogic Case-Shiller Home Price Index. This marked the seventh consecutive monthly gain.
On an annual basis, prices rose 2.6% — the second increase in a row after two declines. The lack of available inventory — and the subsequent, elevated demand — drives the overall price growth and outweighs the dipping sales numbers.
“There are still variations in the market as more affordable markets and those with strong population growth keep encountering pressure on home prices due to continuous lack of available homes for sale. Particularly markets in New England and Midwest, while markets in the South and Southeast have experienced more moderate home price growth recently, following years of rapid increases,” said Selma Hepp, chief economist at CoreLogic.
Housing markets and price tiers
Amongst the country’s 20 largest metro areas, Chicago, New York, and Detroit led the way with year-over-year price gains of 5%, 4.98% and 4.8%, respectively. Chicago’s seen the highest growth for the fourth straight month.
On the other end of the spectrum, Las Vegas fell the furthest with a 4.9% drop. Phoenix and San Francisco followed with declines of 3.9% and 2.5%.
Broken down regionally, the Midwest experienced the biggest price jump at 3.9%, with the Northeast close behind at 3.8%. Meanwhile, the Southwest and West fell 0.8% and 0.9%, respectively.Check your home buying options. Start here
Overall, the high-priced tiers in the U.S. inched up 0.8% annually in August. The middle-tiered homes rose 1.4% and the low tier — where many first-time home buyers shop — gained 2.1%, according to CoreLogic.
The bottom line
If you’re facing affordability difficulties in the current housing market, you’re not alone. However, there may be relief on the way.
“Although housing prices have increased significantly this year, climbing 5% from the early-year low, higher mortgage rates and seasonal trends will slow further monthly gains – with some possible declines in winter months,” said Hepp.Time to make a move? Let us find the right mortgage for you