8% rise from June 2019 to June 2020 – the smallest increase since February 2017. Despite this, it is still near record-breaking levels of appreciation, according to the Federal Housing Finance Agency’s House Price Index.
The latest data from the FHFA shows that the annual increase in prices was slightly above the long-term average of 5.6%, which is the historic trends from 1991-2019. For comparison, the annual growth rate in the previous June reading was 6.5%.
Regionally, the West Coast saw the most moderate rate of growth with a 3.7% year-over-year appreciation while the Northeast region saw the highest at 8.6%. In between those two regions, the Midwest saw an increase of 6.9%, while the South ranked the lowest at 5.1%.
The index also indicated that all nine regions saw a decline in their month-over-month change in home prices from May to June. The largest drop was seen in the Northeast which saw a decrease of 1.2%. A similar trend was seen in the Midwest and West where the respective decreases were 0.9% and 0.8%.
Although the appreciation rate is continuing to slow down from its peak earlier in the year, the steady rate of growth still appears to be healthy for the housing industry. As such, some experts are predicting that the rate of growth could remain stable for the rest of the year as the overall market remains fairly strong.
Despite home price growth slowing down, the Federal Housing Finance Agency’s House Price Index still indicates that it is still at near record-breaking levels. This has been largely attributed to continued demand for housing, as well as low mortgage rates. It is worth noting that all nine regions measured by the index have seen a decrease in their monthly change in home prices from May to June. However, the Northeast experienced the largest decrease at 1.2%.
Experts have predicted that the rate of growth in the housing market will remain stable for the rest of the year due to the healthy market conditions. Despite the slowdown, these record-breaking levels of appreciation are still good news for anyone involved in the industry. Low mortgage rates, in particular, have been credited with boosting the market and allowing more people to enter the market or upgrade their home.
This article was contributed on Jun 28, 2023
