Skip to main content

Home Prices Surge For Eighth Consecutive Month, Setting New Records

Christine Stuart
Sep 19, 2023

First American Data & Analytics cites rising mortgage rates and restricted supply as driving forces; First-time homebuyers face the brunt of the surge.

Despite afforability challenges, First American Data & Analytics found that August marked the eighth month of consecutive price increases. 

Home prices increased by 0.7% from July to August reaching a new peak and year-over-year prices saw an increase of 5.6%. 

“Rising mortgage rates decrease affordability for buyers, but also increase the rate lock-in effect that is currently restricting supply. The net result is rising prices, even as mortgage rates also increase," First American Chief Economist Mark Fleming said. 

The five most populous states experienced the following year-over-year growth: California (+2.4 percent), Texas (+2.8 percent), Florida (+2.6 percent), New York (+1.4 percent), and Pennsylvania (+7.9 percent). The only state with a year-over-year decrease in the HPI is Nevada (-1.7 percent).

Those who are struggling the most in this high mortgage rate environment seem to be first-time homebuyers. 

"The old adage of real estate being local includes sub-markets within a local area, particularly sub-markets defined by price. Changes in mortgage rates affect borrowers trying to buy their first ‘starter’ home differently than luxury buyers," said Fleming. “A pattern emerging within many local markets indicates the starter tier remains a strong sellers’ market with large year-over-year price gains, followed by strong performance in the mid-tier price range that is often outperforming the luxury tier. Limited supply, coupled with rising mortgage rates, impacts affordability and the financial incentive to sell across the income spectrum and is driving potential move-up home buyers to ‘down-filter’ toward lower priced homes in the starter and mid-price tiers."

Published
Sep 19, 2023
Mortgage Rates And Home Prices Soar, Leaving Homebuyers In Limbo

Redfin report highlights slump in sales, yet a glimmer of hope as new listings tick up.

Sep 22, 2023
Rising Mortgage Rates Drive Borrowers To Buydown Points

Western states lead in adoption as homeowners seek short-term relief.

Sep 22, 2023
Mortgage Rates Cling To 7% Threshold, Dampening Homebuying Spirit

Freddie Mac reveals continued high rates amid cooling housing demand; construction sector hit hardest as potential homebuyers await fall for relief.

Sep 21, 2023
Existing-Home Sales Dip in August, Yet Home Prices Surge

As existing-home sales dip further, median prices rise unabated.

Sep 21, 2023
Home Flipping Sees Profit Rebound in Q2, Despite Decreased Activity

ATTOM report indicates an uptick in investor ROI amid broader housing market rebound; all-cash purchases on the decline as loan-backed buying shows promise.

Sep 21, 2023
Federal Reserve Holds Rates Steady But Eyes Future Hike

Fed retains current rate between 5.25%-5.5%; Housing market may see a shift as inflationary pressures are monitored and policy adjustments are made.

Sep 20, 2023