Slowdown in National House Price Growth Seeps into Seventh Straight Month, According to First American Data & Analytics Monthly Home Price Index Report

Rhea-AI Summary

First American Data & Analytics released its July 2024 Home Price Index (HPI) report, revealing a continued slowdown in national house price growth for the seventh consecutive month. Key highlights include:

- National house prices are 55.0% higher compared to pre-pandemic levels (February 2020).
- The year-over-year change in HPI is +5.3%.
- The month-over-month change from June to July 2024 is +0.3%.

Chief Economist Mark Fleming attributes this cooling trend to elevated mortgage rates and low affordability. However, he notes that potential Federal Reserve interest rate cuts this fall may spur market activity. The report also highlights significant variations in local markets, with some areas experiencing strong growth (e.g., Anaheim, Calif., and Pittsburgh) while others see price declines (e.g., Austin, Texas, and Tampa, Fla.).

—House Prices in Several Top Markets are Now Falling, says Chief Economist Mark Fleming—

SANTA ANA, Calif.--(BUSINESS WIRE)-- First American Data & Analytics, a leading national provider of property-centric information, risk management and valuation solutions and a division of First American Financial Corporation (NYSE: FAF), today released its July 2024 Home Price Index (HPI) report. The report tracks home price changes less than four weeks behind real time at the national, state and metropolitan (Core-Based Statistical Area) levels and includes metropolitan price tiers that segment sale transactions into starter, mid and luxury tiers. The full report can be found here.

July¹ National House Price Index

First American Data & Analytics’ National Non-Seasonally Adjusted (NSA) HPI
Metric	Change in HPI
June-July 2024 (month over month)	+0.3 percent
July 2023-July 2024 (year over year)	+5.3 percent

Highlights

• House prices nationally are now 55.0 percent higher compared to pre-pandemic levels (February 2020).
• House price growth reported in last month’s HPI for May 2024 to June 2024 was revised down 0.1 percentage points, from 0.2 percent to 0.1 percent.

Chief Economist Analysis:

“July marked the seventh consecutive month of slowing annualized house price appreciation. Elevated mortgage rates have driven affordability to near-record lows, leaving many buyers on the sidelines and keeping sellers rate locked-in,” said Mark Fleming, chief economist at First American. “The combination of the severely unaffordable market conditions and the rate lock-in effect has largely frozen home buying and selling, contributing to the cooling but still positive pace of appreciation. However, the prospect of Federal Reserve interest rate cuts this fall has already sent mortgage rates lower in August, which may spur some buyers and sellers to act and begin to defrost market transaction volume.”

July 2024 Local Market Price Tier Highlights

The First American Data & Analytics HPI segments home price changes at the metropolitan level into three price tiers based on local market sales data: starter tier, which represents home sales prices at the bottom third of the market price distribution; mid-tier, which represents home sales prices in the middle third of the market price distribution; and the luxury tier, which represents home sales prices in the top third of the market price distribution.

“While the national house price trend is interesting, real estate is inherently local and prices are not appreciating in all markets,” said Fleming. “Annual price growth remains strong in top markets where demand continues to outpace supply or where relative affordability is a draw, such as Anaheim, Calif., and Pittsburgh. In markets that offer relative affordability, homes remain more accessible compared to other major markets, making them attractive to buyers who are priced out of higher-cost regions, despite rising prices. In contrast, house prices in other markets are decelerating notably, with prices declining in cities like Austin, Texas, and Tampa, Fla.”

July 2024 First American Data & Analytics Price Tier HPI Highlights

Core-Based Statistical Areas (CBSAs) Ranked by Greatest Year-Over-Year Increases in Starter Tier HPI
CBSA	Change in Starter Tier HPI	Change in Mid-Tier HPI	Change in Luxury Tier HPI
Pittsburgh	+13.5 percent	+5.4 percent	+2.9 percent
St. Louis	+10.3 percent	+3.9 percent	+4.1 percent
New York	+7.5 percent	+3.7 percent	-1.7 percent
Anaheim, Calif.	+7.4 percent	+9.4 percent	+12.6 percent
Nassau County, N.Y.	+7.4 percent	+4.5 percent	+0.7 percent

Additional July 2024 First American Data & Analytics HPI Highlights

Core-Based Statistical Areas (CBSAs) with Greatest Year-Over-Year Increases in HPI
CBSA	Change in HPI
Anaheim, Calif.	+9.9 percent
Pittsburgh	+6.9 percent
Cambridge, Mass.	+6.8 percent
Miami	+6.7 percent
Seattle	+6.1 percent
Core-Based Statistical Areas (CBSAs) with a Year-Over-Year Decrease in HPI
Austin, Texas	-1.0 percent
Oakland, Calif.	-0.9 percent
Tampa, Fla.	-0.7 percent

HPI data for all 50 states and the largest 30 CBSAs by population is available here.

Next Release

The next release of the First American Data & Analytics House Price Index will take place the week of September 17, 2024.

First American Data & Analytics HPI Methodology

The First American Data & Analytics HPI report measures single-family home prices, including distressed sales, with indices updated monthly beginning in 1980 through the month of the current report. HPI data is provided at the national, state and CBSA levels and includes preliminary index estimates for the month prior to the report (i.e. the preliminary result of July transactions is reported in August). The most recent index results are subject to revision as data from more transactions become available.

The HPI uses a repeat-sales methodology, which measures prices changes for the same property over time using more than 46 million paired transactions to generate the indices. In non-disclosure states, the HPI utilizes a combination of public sales records, MLS sold and active listings, and appraisal data to estimate house prices. This comprehensive approach is particularly effective in areas where there is limited availability of accurate sale prices, such as non-disclosure states. Property type, price and location data are used to create more refined market segment indices. Real Estate-Owned transactions are not included.

Disclaimer

Opinions, estimates, forecasts and other views contained in this page are those of First American’s Chief Economist, do not necessarily represent the views of First American or its management, should not be construed as indicating First American’s business prospects or expected results, and are subject to change without notice. Although the First American Economics team attempts to provide reliable, useful information, it does not guarantee that the information is accurate, current or suitable for any particular purpose. © 2024 by First American. Information from this page may be used with proper attribution.

About First American Data & Analytics

First American Data & Analytics, a division of First American Financial Corporation, is a national provider of property-centric information, risk management and valuation solutions. First American maintains and curates the industry’s largest property and ownership dataset that includes more than 8 billion document images. Its major platforms and products include: DataTree^®, FraudGuard^®, RegsData^®, First American TaxSource™ and ACI^®. Find out more about how First American Data & Analytics powers the real estate, mortgage and title settlement services industries with advanced decisioning solutions at www.FirstAmDNA.com.

About First American

First American Financial Corporation (NYSE: FAF) is a premier provider of title, settlement and risk solutions for real estate transactions. With its combination of financial strength and stability built over more than 135 years, innovative proprietary technologies, and unmatched data assets, the company is leading the digital transformation of its industry. First American also provides data products to the title industry and other third parties; valuation products and services; mortgage subservicing; home warranty products; banking, trust and wealth management services; and other related products and services. With total revenue of $6.0 billion in 2023, the company offers its products and services directly and through its agents throughout the United States and abroad. In 2024, First American was named one of the 100 Best Companies to Work For by Great Place to Work^® and Fortune Magazine for the ninth consecutive year. The company was named one of the 100 Best Workplaces for Innovators by Fast Company in 2023. More information about the company can be found at www.firstam.com.

¹ The most recent index results are subject to revision as data from more transactions become available.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240820677783/en/

Media Contact:

Marcus Ginnaty

Corporate Communications

First American Financial Corporation

(714) 250-3298



Investor Contact:

Craig Barberio

Investor Relations

First American Financial Corporation

(714) 250-5214

Source: First American Data & Analytics

FAQ

What is the current national house price growth trend according to First American's July 2024 HPI report?

According to First American's July 2024 HPI report, national house price growth has been slowing for seven consecutive months, with a year-over-year increase of 5.3% and a month-over-month increase of 0.3% from June to July 2024.

How much higher are house prices compared to pre-pandemic levels in July 2024?

First American's HPI report shows that house prices nationally are 55.0% higher in July 2024 compared to pre-pandemic levels (February 2020).

Which cities are experiencing the highest house price growth according to the July 2024 HPI report?

The July 2024 HPI report indicates that Anaheim, Calif. (+9.9%), Pittsburgh (+6.9%), Cambridge, Mass. (+6.8%), Miami (+6.7%), and Seattle (+6.1%) are experiencing the highest year-over-year increases in house prices.

Are there any cities where house prices are declining according to First American's July 2024 HPI report?

Yes, the report shows that Austin, Texas (-1.0%), Oakland, Calif. (-0.9%), and Tampa, Fla. (-0.7%) are experiencing year-over-year decreases in house prices.

What factors are contributing to the slowdown in house price growth, according to First American's chief economist?

Mark Fleming, First American's chief economist, attributes the slowdown in house price growth to elevated mortgage rates driving affordability to near-record lows and the rate lock-in effect, which has largely frozen home buying and selling activity.