Home price growth finally slows its pace

August 27, 2018 - 2 min read

Q2 sees slowest growth rate in 4 years

Home prices might still be rising, but they’re at least doing so at a slower pace. According to the latest data from the Federal Housing Finance Agency, home price growth was at just 1.1 percent last quarter — its slowest rate in the last four years.

Verify your new rate

Home price growth dampening

Fortunately for today’s home buyers, it appears home price growth is finally dampening. The FHFA’s latest Home Price Index shows that while home prices are up 6.5 percent over 2017, they rose just 1.1 percent in Q2 of this year.

That’s the slowest quarterly pace since 2014, according to William Doerner, the FHFA’s supervisory economist.

“Mortgage rates have increased by more than half a percentage point over the first six months of the year,” Doerner said. “Rates are still inexpensive from a historical standpoint, but their bump-up appears to have gently pressed the brakes on house price increases.”

Home prices aren’t that high, history shows

According to the FHFA, the West South Central Census division has experienced the slowest home price growth in the last year, at 5 percent. This division includes Arkansas, Louisiana, Oklahoma and Texas.

North Dakota experienced the smallest jump in home prices over the year, at 2.1 percent. Louisiana, West Virginia, Connecticut and Alaska also came in on the low end of price growth.

Home prices decrease in 27 cities; here are the top 10

Where price growth is the highest

It’s not all good news, though — at least for some parts of the country.

According to the House Price Index, the Mountain division has seen a 9.5 percent jump in home prices over the last year — the highest increase in the entire nation. This Census division includes Montana, Idaho, Wyoming, Colorado, Utah, Nevada, New Mexico and Arizona.

At the state level, Nevada has seen the most annual price growth, with a whopping 17 percent spike over 2017. Idaho, Washington D.C., Utah and Washington rounded out the top five in terms of appreciation.

Verify your new rate

Get today’s mortgage rates

Want to get in on one of these slower-paced markets? Shop around and see what mortgage rates you qualify for today.

Time to make a move? Let us find the right mortgage for you

Aly J. Yale
Authored By: Aly J. Yale
The Mortgage Reports contributor
Aly J. Yale is a mortgage and real estate writer based in Houston who has contributed to Forbes and worked for organizations such as The Dallas Morning News, PBS, NBC, and Radio Disney.