U.S. home prices slowed again in September as high mortgage rates further weakened demand, according to data released on Tuesday.
The S&P CoreLogic Case-Shiller Index fell by 0.8 percent month over month in September, while rising 10.6 percent year over year.
Meanwhile, an index that measures price growth in 20 major U.S. metro areas showed a 10.4 percent year-over-year gain, down from 13.1 percent the previous month.
“Despite considerable regional differences, all 20 cities in our September report reflect these trends of short-term decline and medium-term deceleration,” Craig J. Lazzara, managing director at S&P DJI, said in a media release.
“Prices declined in every city in September, with a median change of -1.2%. Year-over-year price gains in all 20 cities were lower in September than they had been in August.”
The Federal Reserve’s series of interest rate hikes targeting growing inflation has pushed up mortgage rates in the housing market, making homes unaffordable for many Americans.
Yet mortgage rates have fallen in recent weeks, and the 30-year fixed rate declined by 0.03 percentage points last week to 6.58 percent, according to data from Freddie Mac.
Still, Lazzara said home price growth could continue to slow if the Fed raises interest rates further.
“As the Federal Reserve continues to move interest rates higher, mortgage financing continues to be more expensive, and housing becomes less affordable,” Lazzara continued. “Given the continuing prospects for a challenging macroeconomic environment, home prices may well continue to weaken.”