Home prices across the United States continued to climb in August, but at a significantly slower rate than in prior months, rising at an annualized 12% from the prior month. It marks the second consecutive month of slowing month-over-month appreciation, according to homegenius Home Price Index (HPI) data.
After setting an all-time high for monthly appreciation at 18.8% in June 2022, appreciation rates have tempered significantly, slowing more than 35% from that peak.
According to the data, appreciation rates often ebb in winter months of slower housing activity, but typically rise during the more active, summer buying season. The homegenius HPI is calculated based on the estimated values of more than 70 million unique addresses each month, covering all single-family property types and geographies.
“Over the last two months, the impact of major increases in mortgage rates and inflation have finally been realized in the slowing rate of home price appreciation. It is once again clear that home prices are not impervious to the broader economic conditions around the country,” Steve Gaenzler, SVP of products, data and analytics for homegenius real estate said. “However, the rate of appreciation is still well above the historical norm, at more than 12% month-over-month. While it is likely that appreciation rates will continue to drop, homeowners’ equity remains at all-time highs and inventory remains tight.”
Home prices have risen at an annualized rate of 8.0% over the last six months and 15.9% over the last three months. Home prices have appreciated by 16.7% over the last 12 months.
Since the onset of the U.S. pandemic thirty months ago, homes across the U.S. have appreciated, on average, by more than $88,000. Nationally, the median estimated price for single-family and condominium homes rose to $338,692.
Regional Trends
In August, the MidAtlantic and Northeast markets were the strongest performers, while the West and South showed the strongest slowdown in appreciation.
There were slightly more than 1.01 million properties listed for sale in August, which was the second-lowest level of inventory for any August over the last decade, and 40% lower than the average level of August listings over the last 15 years (1.4mm).
Roughly 290,000 homes were purchased in August, in comparison to 278,000 in July. While August is often the highest sales month, this year the pace of combined sales for July and August was much lower than is typical for the busy summer home-buying season. The last time a summer month (June, July, or August) reported less than 278,000 sales was in 2014. This year, the average sales per month in the summer months was 293,000.
The 20 largest metro areas in the U.S. all recorded slower annual price appreciation in August than in July. The largest decline was in San Francisco, which dropped to just 1.3% appreciation in August. Los Angeles had the second-slowest appreciation rate of large, metropolitan cities, with a 5.7% increase month-over-month.
Cities in Texas and Florida fared the best of large metropolitan areas. Florida cities in particular recorded appreciation rates above 15% relative to the prior month.
