Home Price Growth Slows as Rates Cool Demand
U.S. home prices rose 4.2% year-over-year, but growth is slowing due to high mortgage rates, according to the FHFA House Price Index.
WASHINGTON — U.S. house prices rose 0.3% in November, according to the Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index (HPI). House prices rose 4.2% from November 2023 to November 2024. The previously reported 0.4% price growth in October was revised upward to 0.5%.
However, in a repeat of previous HPI updates, price growth both nationally and regionally showed signs of slowing. The 12-month growth rate in November was 2.7 percentage points lower than it was as of November 2023, the fourth straight month in which the year-over-year growth rate was lower than it had been a year earlier.
“Annual house price gains continued to moderate in November, with sales prices in all nine Census divisions exhibiting slower pace of growth than a year earlier,” said Dr. Anju Vajja, deputy director for FHFA’s Division of Research and Statistics. “The slowdown in price growth is likely due to higher mortgage rates contributing to cooling demand.”
Among the nine geographic divisions defined by the U.S. Census, the change in seasonally adjusted monthly home prices ranged from -0.6% in the East South Central division to 0.9% in the West North Central and New England divisions. The 12-month changes were positive in every region, ranging from 1.8% in the West South Central division to 7.7% in the New England division.
The South Atlantic division, which includes Florida, saw a positive 12-month change of 4.2%, indicating healthy growth compared to some other divisions.
The FHFA HPI is a comprehensive collection of publicly available house price indexes that measure changes in single-family home values based on data from all 50 states and over 400 American cities dating back to the mid-1970s. It incorporates tens of millions of home sales and offers insights about house price changes at the national, census division, state, metro area, county, ZIP code, and census tract levels. FHFA uses a fully transparent methodology based upon a weighted, repeat-sales statistical technique to analyze house price transaction data.
Source: FHFA
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