House prices are declining in these 7 Western states while continuing to hit new heights across the rest of the country
- The FHFA said on Tuesday that US house prices rose modestly in the first quarter.
- But some Western states are seeing the first year-over-year price declines in years.
The US housing market broadly notched price increases as the key spring-selling season began, but one area of the country that was booming saw the air coming out of prices every year, according to government data released Tuesday.
House prices grew 4.3% in the first quarter compared to a year ago, the Federal Housing Finance Agency said in a Tuesday report. The advance meant that the market had notched annual appreciation each quarter since 2012.
The agency's House Price Index reached just under 400, hitting an all-time high with figures tracking back to 1991. The index measures prices of single-family houses with mortgages guaranteed by Fannie Mae and Freddie Mac.
"U.S. house prices generally increased modestly in the first quarter," Anju Vajja, the principal associate director at the FHFA's research and statistics division, said. "However, year over year prices in many western states have started to decline for the first time in over ten years."
Seven states — all located in the Western US— logged price declines. Utah led the list, with prices off by 4.35%. Nevada followed with a drop of 3.6%.
California's house prices fell by 2.86%, and Washington saw a 2.62% drop, the FHFA report said. Also landing on the list were Idaho, Oregon, and Colorado, with the latter seeing prices down 1.07%.
Outside the Western states, the District of Columbia experienced a 2.35% year-over-year price pullback.
Of the nine regions that the FHFA tracked, two had annual house price decreases. The Pacific division was down 2.4%, and the Mountain division was down 0.1%.
Rising interest rates directed by the Federal Reserve in fighting hot inflation have contributed to a slowdown in the housing market since last year, with home sellers slashing listing prices while listings themselves have become scarce.
Separate data from the property software and data provider Black Knight has shown that markets on the West Coast, including San Francisco and Seattle, have seen the biggest slowdowns.
Localized data also points to the sharp regional divides in the housing market. Over the past four quarters, house prices rose in 78 of the top 100 largest metropolitan areas, fronted by a 14% rise for the Miami area. San Francisco-San Mateo-Redwood City, California, was the largest metro area with the greatest price decline, at 10.1%.
Nationwide, FHFA said housing prices rose 0.6% in March. That rate outstripped the 0.3% estimate at Econoday.
The start of the spring selling season showed house-price gains in March in a separate S&P CoreLogic report released Tuesday. Its Case-Shiller Index rose 0.7% in March versus the year-ago period as tight inventory pressured prices upward.
The "decline in home prices that began in June 2022 may have come to an end" in March, the report said.
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