U.S. Home Price Increases Still Slowing

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Home prices in the United States rose for the 30th consecutive month in August, but the increases have slowed sharply in the past three months. Compared with August of 2013, home prices rose 6.4%, including the sales of distressed properties. Month-over-month, August home prices rose 0.3% over July prices. In July, prices rose 7.4% year-over-year and 1.2% month-over-month.

Thirty-two states and the District of Columbia now have home prices at or within 10% of the peak price appreciation. The data were released Tuesday by research firm CoreLogic.

Including sales of distressed properties, the five states posting the largest year-over-year price increases were Michigan (11.1%), California (9.2%), Nevada (9.2%), Maine (9.0%) and West Virginia (8.7%).

Excluding sales of distressed properties, the five states posting the biggest price increases over the past 12 months were Massachusetts (9.4%), Maine (9.3%), West Virginia (8.9%), Hawaii (8.7%) and South Carolina (8.1%).

The five states with the largest peak-to-current declines, including distressed transactions, were Nevada (36.2%), Florida (33.4%), Arizona (28.9%), Rhode Island (26.8%) and Maryland (20.2%).

CoreLogic’s chief economist said:

The pace of year-over-year appreciation continues to slow down as real estate markets find more balance. Home price appreciation reached a peak of almost 12 percent year-over-year in October 2013 and has since subsided to the current pace of 6 percent. Continued moderation of home price appreciation is a welcomed sign of more balanced real estate markets and less pressure on affordability for potential home buyers in the new future.

CoreLogic has forecast that home prices, including distressed sales, will rise 0.2% in September, compared with August, and by 5.2% in the 12 months between August 2014 and August 2015. Both estimates include distressed sales.

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