Home prices nationwide rose 0.3% from August to September after seasonal adjustment per Case-Shiller’s Home Price Index, helping home values reach an all-time high for the sixteenth straight month. Home values in September were also 3.9% higher than a year earlier, following a 4.3% gain in August. Case-Shiller’s index is considered the gold standard in tracking changes inresidential real estate values. The Federal Housing Finance Agency’s (FHFA) House Price Index also showed that home prices rose a seasonally adjusted 0.7% from August to September, and they were 4.4% higher when compared to the same time last year. Note that FHFA’s Index doesnot include cash buyers or jumbo loans, only loans financed with conforming mortgages, which accounts for some of thedifferences in the reports.
What’s the bottom line? While home prices are continuing to appreciate, the pace is slower than earlier in the year. However, homeownership continues to provide a significant wealth creation opportunity. And if mortgage rates come back down, this could drive demand and potentially re-accelerate home price gains, given that supply also remains low on a historic basis.