Home prices continue to grow across the country, but the trend of slowing appreciation persisted in August, according to new data from CoreLogic.
The property analytics company’s latest Home Price Index (HPI) report reveal a 3.6% year-over-year gain in home prices in August, unchanged from July’s annualized figure and up marginally from June’s 3.4% growth. Frank Nothaft, chief economist at CoreLogic, called the gain “a big slowdown from a year earlier when the U.S. index was up 5.5%.”
In fact, home price gains have hovered between 3.3% to 3.6% over the last six months, suggesting that the pace of home appreciation has plateaued.
An especially opportune development for potential first-time buyers has been the price growth slowdown among the least expensive homes available. The lowest-priced homes gained 5.5% year over year in August — more than any other price tier, as the low- to middle-price tier grew 4.5%, the middle-to-moderate price tier grew 3.9%, and the high-price tier grew 3.2%. But the entry level also showed the largest slowdown in price growth compared to a year earlier, when the lowest-priced homes saw an 8.4% increase in price growth.
“While the slowdown in appreciation occurred across the country at all price points, it was most pronounced at the lower end of the market. … This moderation in home-price growth should be welcome news to entry-level buyers,” Nothaft said.
Despite the slowing growth, the HPI has risen on an annual basis every month since February 2012. As of August, the overall HPI was 9% higher than its pre-crisis peak in April 2006 and has gained 61.9% since bottoming out in March 2011. Prices in 40 states and the District of Columbia have risen above their nominal pre-crisis peaks.
As it has for 11 straight months, Idaho led the nation in appreciation, with annual price growth of 11.6%. Just one state saw home prices depreciate, with Connecticut posting a 0.5% drop year over year.