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Two new data reports are offering a positive record of home price performance in the tail-end of 2016.
Black Knight Financial Services (BKFS) is reporting that home prices registered a 5.7 percent year-over-year increase in November. On a month-over-month measurements, November’s prices were up by a slight 0.2 percent from October. Home prices are now within 0.3 percent of a new national peak.
For the fifth consecutive month, New York led all states in monthly home price appreciation—this time, with a 1.1 percent uptick from October. New York City was the best performing metro area for the month, with a 1.4 percent appreciation, while metros in Florida and Tennessee together accounted for eight of the 10 best-performing metros. Eight of the 40 largest metros saw new home price peaks while St. Louis was the sole metro area that saw negative year-to-date home price movement through November.
Separately, the proprietary Real House Price Index from First American Financial Corporation increased 4.4 percent between October and November; on a year-over-year basis, real house prices increased by 1.7 percent.
“The shift in real house prices signals a decrease in affordability, driven primarily by rising mortgage rates,” said Mark Fleming, chief economist at First American. “However, while rates are increasing, they remain very low from a historical standpoint. In contrast, meaningful gains in wages help offset some of the decrease in affordability. Even as rates rise above four percent, housing, on a purchasing-power adjusted basis, continues to be as affordable as it was almost 18 years ago in April 1999.”