CoreLogic Reports U.S. Home Price Growth, Mirrors Previous Data

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A new report from CoreLogic shows U.S. home prices increased by 11.2 percent during the third quarter of 2013, compared to the previous year, mirroring previous market reports. 

The report, which depicts home price trends in more than 380 markets, shows prices were 17 percent higher than the trough during the fourth quarter of 2011. However, prices remained 23 percent below the peak reached in the first quarter of 2006, according to the CoreLogic Case-Shiller indexes. 

The large metro areas -- those with populations greater than 950,000 -- that experienced the most rapid appreciation rates on a year-over-year basis compared to third quarter 2012 were Las Vegas (+30 percent), Sacramento (+27 percent) and Riverside, Calif. (+26 percent). 

The large metro areas with the slowest appreciation rates were Philadelphia (+3 percent), Hartford, Conn (+3 percent) and New Orleans (+3 percent).

"Double-digit price gains are unlikely to persist, but since housing is far more affordable now than it was in 2006, there is less concern that a new housing bubble will occur," Dr. David Stiff, principal economist for CoreLogic Case-Shiller, said in the report. "As of the third quarter of 2013, the ratio of median mortgage payment to median family income was at a 40-year low and 35 percent lower than it was at the peak of the bubble, even after accounting for recent increases in prices and mortgage interest rates."

This report differs from the monthly S&P/Case Shiller report, which provides a more current indication of home price trends. Even though they both use the same data base, this report covers more U.S. markets.

The latest S&P/Case Shiller report this week showed home prices in the 20-city composite increased 13.7 percent year-over-year in November. 

"Investor demand and sales of foreclosed properties are dropping quickly," Dr. David Stiff said. "This is especially true in states that were caught up early in the bubble and have non-judicial foreclosure proceedings, such as California and Arizona. In these states, inventories of bank-owned properties are close to being cleared. Non-investor demand, although increasing, will not replace demand from investors."

Looking ahead, home price appreciation is expected to slow to 4.2 percent nationwide through the third quarter of 2014, close to its long-term annual average of 4.5 percent.  

Metro areas with large projected year-over-year gains through the third quarter of 2014 are Oakland, Calif. (+9 percent), New Orleans (+9 percent) and Fort Worth, Texas (+9 percent). The large metro areas with smaller projected gains are Nashville, Tenn. (+2), Orlando, Fla. (+3 percent) and Jacksonville, Fla. (+3 percent).