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During September, Black Knight determined the average home price at $266,000, up a scant 0.1 percent from August, but it was higher by a more significant 5.4 percent from one year earlier. September’s level is only 0.6 percent away from the peak home price.
Home prices in seven of the nation’s 20 largest states hit new peaks: Massachusetts ($374,000), New York ($362,000), North Carolina ($204,000), Tennessee ($188,000), Texas ($228,000), Washington ($340,000) and Wisconsin ($192,00). Among the states, New York led home price gains among the states for the third consecutive month, up 0.9 percent from August, while neighboring Connecticut was the worst performing state with a 0.9 percent decrease from the previous month plus four of the 10 worst performing metros for home price depreciation.
Separately, the First American Real House Price Index reported real house prices increased by one percent between August and September, with a 5.3 percent year-over-year increase in September. The company said the national price level is 0.9 percent away from the housing-boom peak in 2007.
“While a small uptick in rates in September caused an increase in real house prices compared to August, it is important to remember that mortgage rates remain at historically low levels. The low rates, combined with recent meaningful income gains, fueled an increase in consumer house-buying power, meaning affordability is at a quarter-century best,” said Mark Fleming, chief economist at First American. “Even as interest rates increase above four percent post-election, housing, on a purchasing-power adjusted basis, will continue to be more affordable than it was in the early 1990s.”