Freddie Mac Reports Modest Increase in Home Prices for September
Freddie Mac’s National Home Price Index (FMHPI) rose by 0.28% in September, based on seasonally adjusted data. On a year-over-year (YoY) basis, the FMHPI increased by 3.6%, marking a slight decrease from the 4.0% YoY growth recorded in August. While this marks a cooling in price growth compared to previous peaks—such as the 19.1% YoY increase in July 2021—home prices are still on the rise, with the YoY increase bottoming out at 0.9% in May 2023.
Regional Trends and States Falling Below Previous Peaks
Despite the overall increase, there are notable regional variations. As of September, 11 states saw their home prices fall below previous peaks. The largest declines were recorded in Florida (-2.2%), Louisiana (-1.8%), Arizona (-1.7%), North Carolina (-1.5%), and Arkansas (-1.3%). This highlights how certain areas, especially in the Sun Belt, continue to struggle with price corrections.
In terms of cities, 17 out of the 30 worst-performing markets in the country are located in Florida. Austin, Texas, remains the city with the largest price drop, continuing to underperform relative to other metropolitan areas.
Housing Market Constraints and Future Outlook
The Freddie Mac data indicates that while home prices continue to rise overall, there is growing regional disparity, with some states and cities seeing declines from their peak levels. The ongoing housing shortage and limited inventory, especially in certain high-demand areas, continue to place upward pressure on prices. It remains to be seen how these regional price corrections will unfold, but the overall trend still points to a slow and steady increase in home prices nationally.
For further insights into the real estate market and its dynamics, Calculated Risk Real Estate Newsletter provides a deeper look at housing trends, price movements, and regional differences.