Home prices rose 7.7 percent year-over-year in the fourth quarter, while prices for other goods and services ticked up 0.7 percent, according to the Federal Housing Finance Agency (FHFA) House Price Index, which calculates home prices among mortgages held by Fannie Mae and Freddie Mac. A total of 38 states reported rising prices in the fourth quarter of the year, a significant showing but fewer than the 48 from the previous quarter, according to the FHFA.
On a quarterly basis, prices rose 1.2 percent, marking the tenth consecutive quarter of price increases, according to the FHFA. On a seasonally-adjusted monthly basis, prices rose 0.8 percent in December, according to the agency’s index.
The price appreciation that took place in the fourth quarter was "considerable, but more modest than in recent periods," according to Andrew Leventis, principal economist for the FHFA.
"It is too early to know whether the lower quarterly growth rate represents the beginning of more normalized price appreciation patterns or a more significant slowdown," Leventis added.
Prices rose most over the year in Nevada (24.32 percent), California (19.50 percent), Arizona (15.22 percent), Oregon (12.87 percent), and Florida (12.63 percent), according to FHFA's seasonally-adjusted, purchase-only index.
The five states with the lowest home price appreciation over the year were West Virginia (-1.78 percent), Delaware (0.12 percent), Arkansas (0.50 percent), Connecticut (1.15 percent), and Rhode Island (1.16 percent).
Among the 100 metros with the highest populations in the United States, those with the highest price appreciation over the year were largely based in the West, according to FHFA's all-transaction index, which includes data from both purchases and refinances. In fact, 15 of top 20 are located in California, according to the FHFA. Modesto, California, topped the list with prices rising 28.50 percent over the year. Other states with metros on the top 20 list were Nevada, Oregon, Arizona, and Florida.
Many of the metros ranking lowest for price appreciation over the year are located in the Midwest and the South. Rockford, Illinois experienced the greatest price depreciation over the year with a 6.46 percent drop, according to the FHFA.
Based on the nine Census divisions, prices rose most over the year ending in December in the Pacific region, where they jumped 14.9 percent. The Mountain division posted the second-greatest increase with a 12.6 percent rise in prices, according to the FHFA purchase-only index.