Home prices grow at slowest rate in nearly 2 years

Aly J. Yale
The Mortgage Reports contributor

Two cities see decreases

Home prices are still rising, but according to the latest data, they’ve hit their slowest growth rate since January 2017. Sixteen of the top 20 markets are also seeing slower price gains.

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Price growth slows down

According to the S&P CoreLogic Case-Shiller U.S. National Home Price Index, home prices rose 5.5 percent between September 2017 and September 2018. That’s down from the 5.7 percent increase seen in August and the slowest growth rate seen nationally since the start of 2017.

David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones says the latest data indicates a housing “slowdown.”

“Home prices plus data on house sales and construction confirm the slowdown in housing,” Blitzer said. “Sales of both new and existing single-family homes peaked one year ago in November 2017.”

Existing home sales are down 9.3 percent from that peak, and housing starts have dropped 8.7 percent since the same time. Rising mortgage rates have also played a role, according to Blitzer.

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Where home prices rose the most

Las Vegas, San Francisco and Seattle have seen the biggest year-over-year gains in home prices, with Sin City posting a 13.5 percent uptick since 2017. San Francisco home prices rose 9.9 percent, while Seattle’s jumped 8.4 percent,

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Still, it’s not all bad news for these cities. In fact, in Seattle, prices actually dropped over the month.

“In Seattle, where prices were rising at double-digit annual rates a few months ago, prices dropped last month,” Blitzer said. “The few places reporting larger gains including some of the cities which had the biggest gains and largest losses 10 years ago: Las Vegas, Phoenix and Tampa.”

Other cities have seen recent drops as well. San Diego home prices decreased 1.4 percent in September, and New York’s dipped 1.6 percent in August.

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