Home price appreciation slowing

Curt Long
Curt Long

August 27, 2014

Aug. 27, 2014 – Home price appreciation is slowing, according to data from the Federal Housing Finance Agency and S&P/Case-Shiller Home Price Indices, and that moderation in prices is broad based across the nation.

“Flatter growth in home prices is a welcome development,” said NAFCU Chief Economist and Director of Research Curt Long. “The decline in home affordability had begun to price out many would-be homebuyers.”

FHFA announced Tuesday that U.S. house prices rose a seasonally adjusted 0.8 percent in the second quarter – the 12th consecutive quarterly price increase in the House Price Index.

Compared with last year, home sales price information from mortgages sold to or guaranteed by Fannie Mae and Freddie Mac shows prices rose 5.2 percent from the second quarter of 2013 to the second quarter of 2014. “The extraordinary price appreciation observed over the last few spring seasons was not evident in the second quarter of this year,” said FHFA Principal Economist Andrew Leventis.

The S&P/Case Shiller index – reflecting data through June 2014 – also showed a sustained slowdown in home price increases. The data showed U.S. single-family home prices fell by 0.2 percent in June in its composite index of 20 metropolitan areas.

Data showed a gain of 6.2 percent in the 12 months ending in June in its broader measure of national housing market activity – a downshift in year-over-year gains.

“Home price gains continue to ease as they have since last fall,” says David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, in a statement. “For the first time since February 2008, all cities showed lower annual rates than the previous month. Other housing indicators – starts, existing home sales and builders’ sentiment – are positive. Taken together, these point to a more normal housing sector. 

 

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