Home-price growth accelerated to the fastest pace in more than seven years, showing gains across the country, according to a report released Tuesday.
Home prices, including distressed sales, rose about 0.9% in August and were up 12.4% from a year earlier, the highest annual rate since February 2006, according to CoreLogic, an Irvine, Calif.-based analysis firm. Excluding short sales and other distressed properties, prices rose 1% in August, and were up 11.2% from the year-earlier period, also hitting the fastest annual pace since February 2006.
The housing market in Nevada, where prices crashed during the housing crisis and remain far below peak levels, saw the largest year-over-year price growth in August. Including distressed properties, annual home-price growth in Nevada reached 26%.
Despite that growth, prices in Nevada in August were about 42% below peak. Meanwhile, the state with the lowest annual price growth, including distressed properties, was New Mexico, where prices were up 1.5%.
Including August’s increase and distressed sales, U.S. home prices were about 17% below a 2006 peak.
The report echoes other recently released housing data that show fast year-over-year gains. Still, there’s been concern about the toll that rising mortgage rates are taking on the housing market’s recovery. A recent reading on pending home sales — these are deals that typically close within two months — showed that they fell in August for a third month of declines.
There is some evidence that the growth in home prices is decelerating. But that’s not all bad. Sellers like hot markets and higher prices can help struggling owners. However, a slower pace also gives more first-time buyers and others a chance to participate in the market while affordability remains relatively high.