U.S. home prices fell for a fourth month in October as rising mortgage rates weakened demand.
- U.S. home prices fell for a fourth month in October, sliding 0.5%, according to the Case-Shiller Index.
- Average home prices in West Coast cities are dropping fastest.
- Nationwide, house prices are still up about 9% year-over-year.
- Mortgage rates have increased, weakening demand.
The S&P CoreLogic Case-Shiller National Home Price NSA Index, which gauges the purchase price of houses in major cities nationwide and reports on a two-month delay, dropped 0.5% in October from September, the fourth monthly decline for an index that's down 3% from a peak in June.
Average home prices in all 20 cities included in the Case-Shiller Index dropped, led by Las Vegas. Still, prices are up almost 9% year-over-year, with some regions experiencing much faster growth. Prices in southeastern metropolitan areas including Miami, Tampa, and Charlotte climbed as much as 21% in that time.
The index has slid after a series of Federal Reserve interest rate hikes that have more than doubled the average rate on a 30-year fixed-rate mortgage to 6.27%. Higher rates coupled with inflation and a broader slowdown after the pandemic boom have softened demand. The U.S. Federal Housing Finance Agency says that helps explain two straight months of near-zero appreciation on home prices.
Cities where home prices dropped the most in October from September include:
- Las Vegas: -1.8%
- San Francisco: -1.7%
- Phoenix: -1.6%
- Dallas: -1.3%
- Denver: -1.1%
And those with the smallest one-year increases in prices through October include:
- San Francisco: 0.6%
- Seattle: 4.5%
- Portland: 5.4%
- Minneapolis: 5.9%
- Washington, D.C.: 6.0%