Home price growth cooled again in September, increasing only 11.4%, according to CoreLogic’s Home Price Index.
This is the fifth month of lower YOY growth. Two-thirds of American metros saw at least some month-over-month declines as well, contributing to a 0.5% national decrease from August.
Southeastern states continued to see higher price appreciation than other areas. Florida topped the list for the eighth straight month with 23% growth, followed by South Carolina (+17.6%) and Tennessee (+17.4%). Washington, D.C. ranked last with only 1.8% appreciation.
“The rapid increase in prices during the COVID-19 pandemic caused many U.S. housing markets to reach completely unaffordable levels for potential local homebuyers,” said Selma Hepp, interim Lead of the Office of the Chief Economist at CoreLogic.
“On the West Coast and in Mountain-West states, home prices are slowing from this spring’s high but remain elevated from a year ago.”
Southeastern states are still seeing high price growth because of in-migration from the West and North, she noted. Higher-income buyers are headed to these sunny, more affordable areas.
In turn, these states are seeing a boost in highly educated talent. A recent study found that Florida, Texas, and Tennessee are the best states to succeed in business, citing the influx of workers along with above-average growth rates for jobs and GDP, strong consumer spending, and low levels of corporate and personal income taxes.
As business booms, even more Americans could move into these areas, keeping prices elevated.
Florida, in particular, may continue to see high price appreciation due to the aftermath of Hurricane Ian. Damaged homes that the owners can’t afford to fix may be picked up by investors who plan to spruce them up and either rent or sell for a profit.
“It’s an opportunity for investors to change the landscape of an area that’s been holding strong for 50 years,” said Zahra Antaramian, field operations director at real estate management company ADG4 in Naples, Florida.
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